15.6 Suppose the government imposed a $3 tax on snuffboxes in the industry described in Problem 15.2.

a. How would this tax change the market equilibrium?

b. How would the burden of this tax be shared between snuffbox buyers and sellers?

c. Calculate the total loss of producer surplus as a result of the taxation of snuffboxes. Show that this loss equals the change in total short-run profits in the snuffbox industry. Why don’t fixed costs enter into this computation of the change in short-run producer surplus?