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4) The city of Denver is struggling to find revenue to pay for expansions of city infrastructure. The city has a thriving restaurant scene and

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4) The city of Denver is struggling to find revenue to pay for expansions of city infrastructure. The city has a thriving restaurant scene and one city council member proposes placing a 10% surcharge on all meals eaten at 'sitdown' restaurants. Assume most restaurant patrons have incomes well above the median income for Denver and the price elasticity of demand for restaurant meals is 2.9. Discuss the desirability of this tax from an economic efficiency point of view and an economic equity point of view. (For full credit you must use information from the unit, feel free to add other ideas as well)

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