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Where will the points of the tax revenues be plotted in the graph and which tax level will generate the most revenue ? Suppose a

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Where will the points of the tax revenues be plotted in the graph and which tax level will generate the most revenue ?

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Suppose a small city has a kimchi factory on its outskirts. The local government decides to impose a tax on kimchi. Press releases focus on reducing the fermented cabbage smell during the workweek, but unnamed sources within the government also cite additional revenue as a possible reason for the tax. The accompanying diagram shows the market for kimchi in this city. Show the tax revenues (TR) associated with a $2, $4, and $8 per jar tax on kimchi. I TR [$15.11) Supply I TR ($4.531) I TR [$Sfjar) Price ofkimchi ($13-$ij 0 '1 2 3 4 5 6 7" 8 Q '10 Quantity of kimchi (millions of jars) Which tax level generates the most revenue? 0 The $4 per jar tax generates the most revenue. 0 The $8 per jar tax generates the most revenue. 0 The $2 per jar tax generates the most revenue

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