Complete the following table by filling in the quantity sold, the price buyers pay, and the price sellers receive before and after the tax. Quantity (Pairs of sweatpants) Price Buyers Pay (Dollars per pair) Price Sellers Receive (Dollars per pair) Before Tax After Tax 250 Using your answers from the previous table, calculate the tax burden that falls on buyers and on sellers, respectively, and calculate the price elasticity of demand and supply over the relevant ranges using the midpoint method. Enter your results in the following table. Tax Burden (Dollars per pair) Elasticity Buyers Sellers The tax burden falls more heavily on the side of the market that is elastic. The following graph shows the weekly market for sweatpants in some hypothetical economy. Suppose the government levies a tax of $11.60 per pair. The tax places a wedge between the price buyers pay and the price sellers receive. PRICE (Dollars per pair) 50 45 40 35 20 15 10 10 5 Tax Wedge Supply Demand 0 50 100 150 200 250 300 350 400 450 500 QUANTITY (Pairs of sweatpants) ?
Complete the following table by filling in the quantity sold, the price buyers pay, and the price sellers receive before and after the tax. Quantity (Pairs of sweatpants) Price Buyers Pay (Dollars per pair) Price Sellers Receive (Dollars per pair) Before Tax After Tax 250 Using your answers from the previous table, calculate the tax burden that falls on buyers and on sellers, respectively, and calculate the price elasticity of demand and supply over the relevant ranges using the midpoint method. Enter your results in the following table. Tax Burden (Dollars per pair) Elasticity Buyers Sellers The tax burden falls more heavily on the side of the market that is elastic. The following graph shows the weekly market for sweatpants in some hypothetical economy. Suppose the government levies a tax of $11.60 per pair. The tax places a wedge between the price buyers pay and the price sellers receive. PRICE (Dollars per pair) 50 45 40 35 20 15 10 10 5 Tax Wedge Supply Demand 0 50 100 150 200 250 300 350 400 450 500 QUANTITY (Pairs of sweatpants) ?
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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Question
answer the following questions based on the graph for microeconomics .
Transcribed Image Text:Complete the following table by filling in the quantity sold, the price buyers pay, and the price sellers receive before and after the tax.
Quantity
(Pairs of sweatpants)
Price Buyers Pay
(Dollars per pair)
Price Sellers Receive
(Dollars per pair)
Before Tax
After Tax
250
Using your answers from the previous table, calculate the tax burden that falls on buyers and on sellers, respectively, and calculate the price elasticity
of demand and supply over the relevant ranges using the midpoint method. Enter your results in the following table.
Tax Burden
(Dollars per pair)
Elasticity
Buyers
Sellers
The tax burden falls more heavily on the side of the market that is
elastic.
Transcribed Image Text:The following graph shows the weekly market for sweatpants in some hypothetical economy. Suppose the government levies a tax of $11.60 per pair.
The tax places a wedge between the price buyers pay and the price sellers receive.
PRICE (Dollars per pair)
50
45
40
35
20
15
10
10
5
Tax Wedge
Supply
Demand
0
50
100
150 200 250 300 350 400 450 500
QUANTITY (Pairs of sweatpants)
?
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