34. Effect of a tax on buyers and sellers The following graph shows the daily market for wine when the tax on sellers is set at $0 per bottle Suppose the government Institutes a tax of $40.60 per bottle, to be paid by the seller. (Hint: To see the impact of the tax, enter the value of the tax in . zero the Taxon Sellers field and move the green line to the after-tax equilibrium by adjusting the value in the Quantity field. Then, enter were in the Tax on Seilers field. You should see a tax wedge between the price buyers pay and the price ellers receive) Use the graph input tool to help you answer the following questions. You will not be scored on any changes you make to this graph . Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. a a . Graph Input Tool Market for Wine 10 Suggy 10 Quantity (Hotties of Demand Price er bottle 140 132.00 Supply Price (Dulan per bottle) 0.00 PRICE Doitus per botte #88888 Supply Shifter Demand Tax on Sellers (Dolors per hoche) 0.00 0 10 200 PO QUANTITY Totties of the Fill in the following table with 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 shoes) (Dollars per pair) (Dollars per pair) Before Tax After Tax Using the data you entered in the previous table, calculate the tax burden that falls on buyers and sellers, respectively, and calculate the price elasticity of demand and supply over the relevant ranges using the midpoint method. Enter your results in the following table. Tax Burden (Dollars per pair) Elasticity less Buyers Sellers more The burden of the tax falls more heavily on the elastic side of the market