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bluejean bluejean
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A year ago
Efficiency of Taxation

The graph shows the demand (D) and supply (S) for the oil market.
 
Assume that A=235, B=175, C=100, D=25, E=30, and F=135. What is the excess burden of a government imposed tax equal to (P4-P2)? Suppose this market suffers from a negative externality and the amount of the tax equals the marginal external cost of the externality. What is the excess burden of the tax?

▸ $130, $130

▸ $330, $330

▸ $130, $0

▸ $330, $130
Textbook 
Macroeconomics

Macroeconomics


Edition: 3rd
Authors:
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greiner76greiner76
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A year ago
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