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6. Who should pay the tax? The following oraph gives the labor market for laboratory aides in the imaginary country of Paideia. The equilibrlum hourly

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6. Who should pay the tax? The following oraph gives the labor market for laboratory aides in the imaginary country of Paideia. The equilibrlum hourly wage is $10, and the equilibrium number of laboratory aides is 150 . Suppose the federal government of Paideia has decided to institute an hourly payroll tax of $4 on laboratory aides and wants to determine whether the tax should be levied on the workers, the employers, or both (in such a way that half the tax is collected from each party). Use the orahh inout tool to evaluate these three proposais. Entering a number into the Tax Levied on Employers feld (intially set at zero dolfars per hour) shits the demand curve down by the amount you enter, and entering an number into the Tax levied on Workers field (miball ser at rero dallars per hour) shifs the supply curve uo by the amount you enter, To determine the before-tax wage for each tax progosal, adjust the amount in the Wage field untir the quantity of labor supplied equals the cuantity of labor demanded. You will not be graded on any changes you make to this graah. Note: Once you enter a value in a white field, the oraph and any corresponding amounts in each grey field will change accordingly. each of the proposats, use the previous graph to determine the new number of laboratory aides hired. Then comoute the after-tax amount paid Vemployers (that is, the wage paid to wokkers plus any taxes collected from the emplovers) and the after-tax amount eamed by laboratory aides that is, the wage received by workers minus any taxes collected from the workers). Supbose the govemment doesn't want to discourage employers from hiring laboratory aides and, therefore, wants to minimize the share of the tax baid by the employers. Of the three tax proposals, which is best for accomplishing this goal? The proposal in which the entire tax is collected from werkers The proposal in which the tax is collected from each side evenly The proposal in which the tax is collected from employers None of the proposals is better than the others

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