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I do not understand. 1. Understanding the implications of taxes on welfare The following graph represents the demand and supply for blinkies (an imaginary product).

I do not understand.

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1. Understanding the implications of taxes on welfare The following graph represents the demand and supply for blinkies (an imaginary product). The black point (plus symbol) indicates the pre-tax equilibrium. Suppose the government has just decided to impose a tax on this market; the grey points (star symbol) indicate the after-tax scenario (?) Demand Supply 56.00 B 48.00 D PRICE (Dollars per blinkie) 40.00 QUANTITY (Blinkies) Complete the following table, given the information presented on the graph. Result Value Equilibrium quantity before tax Price consumers pay before tax Per-unit tax In the following table, indicate which areas on the previous graph correspond to each concept. Check all that apply. Concept A B C EF Tax revenue after the tax is imposed Producer surplus before the tax is imposed 0 0 0 0 0 0 Consumer surplus after the tax is imposed 0 0 0 0 0 0

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