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Suppose the government imposes an excise tax on commercial tans. The black line on the following graph shows the tax wedge created by a tax of $40 per fan. First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade the area representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producer surplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss. After Tax 200 180 Таx Revenue 160 Demand 140 120 Consumer Surplus 100 Тах Wedge 80 Supply Producer Surplus 60 40 Deadweight Loss 20 50 100 150 200 250 300 350 400 450 500 QUANTITY (Fans) Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumer surplus, producer surplus, tax revenue, and deadweight loss after the tax. Note: You can determine the areas of different portions of the graph by selecting the relevant area. Before Tax After Tax (Dollars) (Dollars) Consumer Surplus Producer Surplus Tax Revenue Deadweight Loss PRICE (Doll ars per fan)

Suppose the government imposes an excise tax on commercial tans. The black line on the following graph shows the tax wedge created by a tax of $40 per fan. First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade the area representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producer surplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss. After Tax 200 180 Таx Revenue 160 Demand 140 120 Consumer Surplus 100 Тах Wedge 80 Supply Producer Surplus 60 40 Deadweight Loss 20 50 100 150 200 250 300 350 400 450 500 QUANTITY (Fans) Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumer surplus, producer surplus, tax revenue, and deadweight loss after the tax. Note: You can determine the areas of different portions of the graph by selecting the relevant area. Before Tax After Tax (Dollars) (Dollars) Consumer Surplus Producer Surplus Tax Revenue Deadweight Loss PRICE (Doll ars per fan)

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Suppose the government imposes an excise tax on commercial tans. The black line on the following graph shows the tax wedge created by a tax of $40 per fan. First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade the area representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producer surplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss. After Tax 200 180 Таx Revenue 160 Demand 140 120 Consumer Surplus 100 Тах Wedge 80 Supply Producer Surplus 60 40 Deadweight Loss 20 50 100 150 200 250 300 350 400 450 500 QUANTITY (Fans) Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumer surplus, producer surplus, tax revenue, and deadweight loss after the tax. Note: You can determine the areas of different portions of the graph by selecting the relevant area. Before Tax After Tax (Dollars) (Dollars) Consumer Surplus Producer Surplus Tax Revenue Deadweight Loss PRICE (Doll ars per fan)
Transcribed Image Text:Suppose the government imposes an excise tax on commercial tans. The black line on the following graph shows the tax wedge created by a tax of $40 per fan. First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade the area representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producer surplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss. After Tax 200 180 Таx Revenue 160 Demand 140 120 Consumer Surplus 100 Тах Wedge 80 Supply Producer Surplus 60 40 Deadweight Loss 20 50 100 150 200 250 300 350 400 450 500 QUANTITY (Fans) Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumer surplus, producer surplus, tax revenue, and deadweight loss after the tax. Note: You can determine the areas of different portions of the graph by selecting the relevant area. Before Tax After Tax (Dollars) (Dollars) Consumer Surplus Producer Surplus Tax Revenue Deadweight Loss PRICE (Doll ars per fan)
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