Suppose that a city government introduces a $0.50 excise (commodity) tax on consumers of bottles of soda to improve Market for Bottles of Soda the health of its citizens. Manipulate the accompanying graph 5.0 to demonstrate the impact of the tax on the market for soda 4.5 S What would be the new equilibrium quantity if instead of 4.0 taxing consumers, the city taxed producers? 3.5 3.0 Price ($/bottle) 2.5 thousand bottles 2.0 1.5 D 1.0 0.5 0.0 0 1 2 3 4 5 6 7 8 9 10 Quantity (thousands of bottles)