Questions: Homework: Chapter 19 Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax. Quantity (Pairs of shoes) Price Buyers Pay (Dollars per pair) Price Sellers Receive (Dollars per pair) ------------ Before Tax 10 150.00 150.00 After Tax 10 184.00 116.00 Using the data you entered in the previous table, calculate the tax burden that falls on buyers and sellers, respectively, and calculate the elasticity of demand and supply over the relevant ranges using the midpoint method. Enter your results in the following table. Tax Burden (Dollars per pair) Elasticity --------- Buyers - Sellers The burden of the tax falls more heavily on the elastic side of the market.
Transcript text: Homework: Chapter 19
Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax.
\begin{tabular}{lccc}
& \begin{tabular}{c}
Quantity \\
(Pairs of shoes)
\end{tabular} & \begin{tabular}{c}
Price Buyers Pay \\
(Dollars per pair)
\end{tabular} & \begin{tabular}{c}
Price Sellers Receive \\
(Dollars per pair)
\end{tabular} \\
\hline Before Tax & 10 & 150.00 & 150.00 \\
After Tax & 10 & 184.00 & 116.00
\end{tabular}
Using the data you entered in the previous table, calculate the tax burden that falls on buyers and sellers, respectively, and calculate th elasticity of demand and supply over the relevant ranges using the midpoint method. Enter your results in the following table.
\begin{tabular}{lcc}
& \begin{tabular}{c}
Tax Burden \\
(Dollars per pair)
\end{tabular} & Elasticity \\
\hline Buyers & $\square$ & - \\
Sellers & $\square$ &
\end{tabular}
The burden of the tax falls more heavily on the elastic side of the market.
Solution
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