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2) Price of cannabis at the local cannabis store is $25 dollars per unit. Gov't desperately needs cash because of the coronavirus lockdowns so levies
2) Price of cannabis at the local cannabis store is $25 dollars per unit. Gov't desperately needs cash because of the coronavirus lockdowns so levies a tax of $5.00 per unit. Properly a) label the graph below (pre-tax) and b) indicate the incidence of tax with the proper curve. Also, c) indicate the total tax revenue the gov't should expect to rake in per 5 unit. Market equilibrium shown at P=$25 and Q = 100,000 units.
Price 30.00 27.50 25.00 22.50 20.00 17.50 80 90 100 110 120 Quantity (000)Step by Step Solution
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