Please help Q4 all questions.

0.2: Taxing the Consumers: As in ()3, the government is to impose a tax of $1 per unit on the transaction of the good. But now we know that the tax is to be imposed on consumers. Price Withaoonsumertaxof$1perunm the MBcurvewill shrft down bySl. This is because the benet from consumption is reduced by $1 dueto the consumption tax. {ii} Identify the new equilibrium point and denote it as n on the diagram. {iii} From 0, identify the new equilibrium price and denote it as P9 on the price axis. This is the price that consumers pay producers under this tax regime. Next, consumers will pay taxes! {iv} Starting at Point (I, draw a vertical dash line upwardly until it hits the original demand curve {i.e., the demand curve without tax]. Denote that point as I. {v} Starting at Point 2, draw a horizontal dash line toward the price axis and denote the associated price as P'. This is the total price that consumers pay, which is the sum of the price consumers pay producers {PF} and the tax consumers pay Uncle Sam {$1}. {vi} Pc-PP=? (A) A random number (B) The tax amount (Cl 51 [D] Both B and C are correct. Mswer: Q4: The equivalency between taxing consumers and tailing producers Let's summarize what we learn in Q1, 02 and 03. {ii {iii In (12 where the tax is imposed on consumers, we learn that: The consumer tax has the effect of shifting the demand curve (up I down} by the amount of the tax. Answer: The new 5&0 intersection point gives us the market price that consumers pay producers. Consumers still need to pay the tax, effectively (increasing I reducing) their total price paid by that amount. Answer: From (12, what is the expression for the consumers' tax burden [per unit]? Answer: - From (12, what is the expression for the producers' tax burden {per unit)? Answer: - In 03 where the tax is imposed on producers, we learn that: The producer tax has the effect of shifting the 5|]!pr curve [up I down) by the amount of the tax. Answer: The new 5&0 intersection point gives us the market price that consumers pay producers. Producers still need to pay the tax, effectively [increasing I reducing} their net price received by that amount Answer: From [13, what is the expression for the consumers' tax burden [per unit]? Amwer: - From Q3, what is the expression for pmduoers' tax burden {per unit)? Answer: - Thus, as far as the effect on consumer and producer prices are concerned, there is an equivalency between taxing the consumers and taxing the producers. Further, from the much simpler analysis in (11, we see clearly that the tax has the effect of creating a P W between the net price consumers pay and the net price producers receive, with the difference being the amount of the Answer1:P W Answerz :T Q3: Taxing the Producers: Similar to Q4, the government is to impose a tax of $1 per unit on the transaction of the good. But, this time the tax is to be imposed on producers. Price Supply = MC With a producer tax of $1 per unit, the MC $5 S curve will shift up by $1. This is because the cost of production is increased by $1 due to the production tax. Demand = MB Quantity (ii) Identify the new equilibrium point and denote it as Q on the diagram. (iii) From Q, identify the new equilibrium price and denote it as Pc on the price axis. This is the price that consumers pay producers under this tax regime. Next, producers will pay taxes. (iv) Starting at Point Q, draw a vertical dash line downwardly until it hits the original supply curve (i.e., the supply curve without tax). Denote that point as (v) Starting at Point E, draw a horizontal dash line toward the price axis and denote the associated price as PP. This is the net price that producers receive, which is the difference between the price received from consumers (Pc) and the tax producers pay Uncle Sam ($1). (vi) pc - PP = ? (A) A random number (B) The tax amount (C) $1 (D) Both B and C are correct