Suppose the following graph illustrates the daily market for wine in the United States. The orange (upward-sloping) line represents the long-run supply curve of wine, and the blue (downward-sloping) line represents the market demand.Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.The market is initially in equilibrium. Then the government imposes a $5.80 per bottle tax to be paid by the seller.Hint: To see the impact of the tax, enter the value of the tax in the "Tax on Sellers" field and move the green line to the after-tax equilibrium by adjusting the value in the "Quantity" field. Then, enter zero in the "Tax on Sellers" field. You should see a tax wedge between the price buyers pay and the price sellers receive.Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.

Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax.

	Quantity	Price Buyers Pay	Price Sellers Receive
(Bottles of wine per day)	(Dollars per bottle)	(Dollars per bottle)
Before Tax
After Tax

Using the data you entered in the preceding table, calculate the tax burden that falls on buyers and sellers, respectively. Enter your results in the following table.

	Tax Burden
(Dollars per bottle)
Buyers
Sellers

Given that the burden of the tax falls more heavily on the ____elastic side of the market, you can tell that demand is ______ elastic than supply at these prices.

Graph Input Tool

Market for Wine
	Quantity (Bottles of wine) 10
	Demand Price (Dollars per bottle) 75			Supply Price (Dollars per bottle) 17

		Supply Shifter
			Tax on Sellers (Dollars per bottle)