What fraction of the incidence falls on consumers? on, Ask an Expert

Economics

Suppose a tax on beans of $0.05 per can is levied on firms. As a result of the tax, the equilibrium price increases from $0.20 to $0.22.

a. What fraction of the incidence falls on consumers? On firms?
b. Suppose the supply elasticity is 0.6. What must the demand elasticity be?

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Microeconomics, Economics

Category:- Microeconomics
Reference No.:- M939904

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