9.20 Chapter 8 - Econ 101 Introduction to Microeconomics...

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Click to edit Master subtitle style Econ 101 Introduction to Microeconomics Professor Richard V. Burkhauser 8 Application: The Costs of Taxation
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Econ 101 – Professor Burkhauser Key Concepts deadweight loss, p. 163
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Econ 101 – Professor Burkhauser Figure 8.1 The Effects of a Tax Size of tax Quanti ty 0 Pri ce Price buyers p a y Price sellers recei ve Dema nd Sup ply Pri ce without tax Quant ity without tax Quant ity with tax
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Econ 101 – Professor Burkhauser Tax Revenue T = the size of the tax Q = the quantity of the good sold T times Q = the government’s tax revenue How a Tax Affects Market Participants
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Econ 101 – Professor Burkhauser Figure 8.2 Tax Revenue T a x reven ue ( T × Q) Size of tax ( T ) Quant ity sold ( Q ) Quanti ty 0 Pri ce Dema nd Sup ply Quant ity without tax Quant ity with tax Price buyers p a y Price sellers recei ve
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Econ 101 – Professor Burkhauser Figure 8.3 How a Tax Effects Welfare A E B D C F Quanti ty 0 Pri ce Dema nd Sup ply = P B Q 2 = P S Pri ce buy ers p a y Pri ce sell ers recei ve = P 1 Q 1 Pri ce without tax
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Econ 101 – Professor Burkhauser Table 8.1 How a Tax Affects Welfare
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