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tlc_71111 tlc_71111
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Posts: 387
6 days ago

Suppose the price of gasoline is $3.50 per gallon, the quantity of gasoline demanded is 150 billion gallons per year, the price elasticity of demand for gasoline is -0.06, and the federal government decides to increase the excise tax on gasoline by $1.00 per gallon, which increases the price of gasoline by $0.75 per gallon. How much revenue does the federal government receive from the tax?



$95.44 billion



$111.20 billion



$148.27 billion



$161.61 billion

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mnp2357mnp2357
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Posts: 337
6 days ago
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$148.27 billion

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