Instructions: Type in the amount of a tax, and click Supply or Demand to choose whether the tax is imposed on sellers or on buyers.Then move the Demand or Supply sliders to change the elasticities of supply and demandSet the tool to illustrate an $8 tax imposed on the buyers. Adjust the elasticity demand so that the vertical intercept is $80. Adjustthe supply elasticity so that the vertical intercept of the supply curve is $40. Answer the following questions:a. What is the price paid with this $8 tax? $[(answer to two decimal places)D. How does the new price change as you move the supply slider towards "less elastic?"the after price talisc. What changes if you impose the tax on sellers instead of on buyers?supply shifts instead of demand Graphs: Tax IncidenceDJ PLE90 $90.0080706050403020100$50.001.020 3.04.05.06.07.08.0 9.0SevedQuantity(thousands per week)Tax imposed on:Excise Tax (0-$20)DemandPerfectlyInelasticSupplyElasticCALCULATIONSNo TaxWith TaxSupplyRelatively ElasticPerfectly ElasticDemandPrice Paid$50.00$50.000.00RelativelyElasticPerfectlyflacQuantity4,0004,000Help

The supply curve shows the quantity of a good or service that producers are willing and able to sell…

Instructions: Type in the amount of a tax, and click Supply or Demand to choose whether the tax is imposed on sellers or on buyers. Then move the Demand or Supply sliders to change the elasticities of supply and demand Set the tool to illustrate an $8 tax imposed on the buyers. Adjust the elasticity of demand so that the vertical intercept is $80 Adjust the supply elasticity so that the vertical intercept of the supply curve is $40. Answer the following questions: a. What is the price paid with this $8 tax? $[ (answer to two decimal places) How does the new price change as you move the supply slider towards "less elastic?" c. What changes if you impose the tax on sellers instead of on buyers? ead of demand

Instructions: Type in the amount of a tax, and click Supply or Demand to choose whether the tax is imposed on sellers or on buyers. Then move the Demand or Supply sliders to change the elasticities of supply and demand Set the tool to illustrate an $8 tax imposed on the buyers. Adjust the elasticity of demand so that the vertical intercept is $80 Adjust the supply elasticity so that the vertical intercept of the supply curve is $40. Answer the following questions: a. What is the price paid with this $8 tax? $[ (answer to two decimal places) How does the new price change as you move the supply slider towards "less elastic?" c. What changes if you impose the tax on sellers instead of on buyers? ead of demand

Microeconomics: Principles & Policy

14th Edition

ISBN:9781337794992

Author:William J. Baumol, Alan S. Blinder, John L. Solow

Publisher:William J. Baumol, Alan S. Blinder, John L. Solow

Chapter6: Demand And Elasticity

Section: Chapter Questions

Problem 3TY

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Similar questions

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