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ADraw Another Line on the Graph Representing a Tax Increase

Question 205

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   A.Draw another line on the graph representing a tax increase of $1. B.How much is the new equilibrium price and quantity? C.How much of the tax is borne by the buyers and how much is borne by the sellers?
A.Draw another line on the graph representing a tax increase of $1.
B.How much is the new equilibrium price and quantity?
C.How much of the tax is borne by the buyers and how much is borne by the sellers?

Correct Answer:

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(a) blured image (b) $15.50 and ...

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