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Calculating tax incidence Suppose that the local government of Jacksonville decides to institute a tax on cider producers. Before the tax, 25 million cases of
Calculating tax incidence Suppose that the local government of Jacksonville decides to institute a tax on cider producers. Before the tax, 25 million cases of cider were sold every month at a price of $10 per case. After the tax, 18 million cases of cider are sold every month; consumers pay $12 per case, and producers receive $7 per case (after paying the tax)
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