Answer the given question with a proper explanation and step-by-step solution. Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax.Quantity(Pairs of shoes)Price Buyers Pay(Dollars per pair)Price Sellers Receive(Dollars per pair)Before TaxAfter Tax The following graph shows the daily market for shoes when the tax on sellers is set at $0 per pair.Suppose the government institutes a tax of $40.60 per pair, to be paid by the seller. (Hint: To see the impact of the tax, enter the value of the tax inthe Tax on Sellers field and move the green line to the after-tax equilibrium by adjusting the value in the Quantity field. Then, enter zero in the Tax onSellers field. You should see a tax wedge between the price buyers pay and the price sellers receive.)Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.PRICE (Dollars per pair)2001801801400H✓0SupplyDemand10 20 30 40 50 60 70 80 90 100QUANTITY (Pairs of shoes)Graph Input ToolMarket for ShoesQuantity(Pairs of shoes)Demand Price(Dollars per pair)10132.00Supply Price(Dollars per pair)Supply ShifterTax on Sellers(Dollars per pair)(?)0.000.00

A tax on sellers is a type of indirect tax that is imposed on the producers or sellers of goods and…

Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax. Quantity (Pairs of shoes) Price Buyers Pay (Dollars per pair) Price Sellers Receive (Dollars per pair) Before Tax After Tax

Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax. Quantity (Pairs of shoes) Price Buyers Pay (Dollars per pair) Price Sellers Receive (Dollars per pair) Before Tax After Tax

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

100%

Answer the given question with a proper explanation and step-by-step solution.

Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax.
Quantity
(Pairs of shoes)
Price Buyers Pay
(Dollars per pair)
Price Sellers Receive
(Dollars per pair)
Before Tax
After Tax

The following graph shows the daily market for shoes when the tax on sellers is set at $0 per pair.
Suppose the government institutes a tax of $40.60 per pair, to be paid by the seller. (Hint: To see the impact of the tax, enter the value of the tax in
the Tax on Sellers field and move the green line to the after-tax equilibrium by adjusting the value in the Quantity field. Then, enter zero in the Tax on
Sellers field. You should see a tax wedge between the price buyers pay and the price sellers receive.)
Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.
Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.
PRICE (Dollars per pair)
200
180
180
140
0
H
✓
0
Supply
Demand
10 20 30 40 50 60 70 80 90 100
QUANTITY (Pairs of shoes)
Graph Input Tool
Market for Shoes
Quantity
(Pairs of shoes)
Demand Price
(Dollars per pair)
10
132.00
Supply Price
(Dollars per pair)
Supply Shifter
Tax on Sellers
(Dollars per pair)
(?)
0.00
0.00

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Step 1: Introduce the concept of tax on sellers.

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Step 3: Determine the quantity sold, price buyer pay and price sellers receive after tax.

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