
Quantity

Price Buyers Pay

Price Sellers Receive


(Bottles of wine)

(Dollars per bottle)

(Dollars per bottle)


Before Tax 



After Tax 




Tax Burden

Elasticity


(Dollars per bottle)


Buyers 


Sellers 

It can be seen from the above diagram that equilibrium price = $25 and equilibrium quantity = 250 units. Furthermore, there is a tax of $11.60 imposed by the ...
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