Figure 20P-1 shows a hypothetical market for gasoline.a. Suppose an excise tax of $1.50 per gallon is levied on gasoline suppliers. Draw the after-tax supply curve. What price will consumers pay? What price will sellers receive?b. How much government revenue will result from the tax?c. Suppose the tax is raised to $3 per gallon. Draw the new after-tax supply curve. How much additional revenue will this raise compared to the $1.50 tax?d. Suppose the tax is raised again to $4.50 per gallon. Draw the new after-tax supply curve. Does this newest tax increase cause tax revenue to increase, decrease, or remain the same as compared to the $3 per gallon tax?Figure 20P-1:
Figure 20P-1 shows a hypothetical market for gasoline.a. Suppose an excise tax of $1.50 per gallon is levied on gasoline suppliers. Draw the”
by | Mar 12, 2022 | Uncategorized
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