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How much of the tax burden does each bear
Course:- Business Economics
Reference No.:- EM131092752





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Assignment Help >> Business Economics

Using a demand function of P = 7 – 2Q and a supply function of P = 4 + Q, and when adding an unit excise tax of $1.50, determine the following:

1) Who really bears the burden of this tax? I. Consumers II. Producers or III. Both

2) How much of the tax burden does each bear?

3) Who bears more? Why? What causes them to bear more of the tax burden?




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