Use the following to answer questions :
Figure 4-4
-The sales tax benefits the suppliers in the market depicted by Figure 4-4 since they now receive $40 per unit in equilibrium, while they had previously only received $30.00 per unit.

Question

Use the following to answer questions :
Figure 4-4 
-The sales tax benefits the suppliers in the market depicted by Figure 4-4 since they now receive $40 per unit in equilibrium, while they had previously only received $30.00 per unit.

Quizplus · Accepted Answer

The statement is incorrect. Sales tax benefits the government by generating revenue, not the suppliers in the market. The increase in price due to sales tax may result in an increase in revenue for the suppliers, but it is not direct benefit from the tax itself.

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