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3 . Effect of a tax on buyers and sellers The following graph shows the weekly market for sweatpants in some hypothetical economy. Suppose the
3 . Effect of a tax on buyers and sellers The following graph shows the weekly market for sweatpants in some hypothetical economy. Suppose the government levies a tax of $23.20 per pair. The tax places a wedge between the price buyers pay and the price sellers receive. 100 - 90 ' BO- 5 l m . + UPD 3' 5 ' Tax Wedge so - + + 40- 30' PRICE [Dollars per pair) 20' '10' Demand 0 |. _ . . 0 1o 20 30 40 so so in no so 100 QUANTITY {Pairs of sweatpants} Complete the following table by lling in the quantity sold, the price buyers pay, and the price sellers receive before and after the tax. Quantity Price Buyers Pay Price Sellers Receive (Pairs of sweatpants) (Dollars per pair) (Dollars per pair) Before Tax After Tax
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