The full questions to the problem are within the picture. For the first question

Question

The full questions to the problem are within the picture. For the first question, I must fill in the blanks within the question. Also, the second question asks to determine if the statement within the picture is either true or false. Thank you.
9781337 5% MINDTAP From Cengage Homework (Ch 06) Attempts S. Calculating tax incidence Suppose that the U.S. government decides to charge cola producers a tax. Before the tax, 30 per case. After the tax, 24 billion cases of cola are sold every year; consumers pay 57 per case, and tax). billion cases of cola were sold every year at a price of $6 producers receive $3 per case (after paying the The amount of the tax on a case of cola iss per case. Of this amount, that falls on producers is S per case, and the burden per case True or False: The effect of the tax on the quantity sold would have been smaller if the tax had been levied on consumers. True

Explanation / Answer

1)Total tax is the difference between what the consumer pays and what producer receives

Thus total tax=7-3=$4 per unit

Consumer pays $7 after tax, thus tax burden=7-6=$1

And producer revenues $3 after tax, thus producer burden on tax=$3.

2) False because the same result would have occurred, either tax is imposed on buyer or seller or on both. Because tax burden depends on the elasticity of demand and elasticity of supply.

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.