3 Supply and demand analysis can also be used to think about other kinds of taxes, such as the payroll tax. The payroll tax in the United States is legally shared equally between the employer and the employee, each paying 7.6 percent of wages. Using graphs, analyze the incidence and excess burden of this tax if:

(a) labor supply is perfectly elastic;

(b) both labor supply and demand are highly elastic;

(c) labor supply is relatively inelastic, labor demand is relatively elastic;

(d) labor supply is relatively elastic, labor demand is relatively inelastic.