Using the graph shown below,answer the following questions.
a.What was the equilibrium price in this market before the tax
b.What is the amount of the tax
c.How much of the tax will the buyers pay
d.How much of the tax will the sellers pay
e.How much will the buyer pay for the product after the tax is imposed
f.How much will the seller receive after the tax is imposed
g.As a result of the tax,what has happened to the level of market activity
Definitions:
Contemporary Exchange
Modern-day transactions or interactions, which can be economic, social, or cultural, reflecting current practices and values.
Rational Choice Theories
Rational choice theories are based on the premise that individuals make decisions by calculating the costs and benefits of various actions to maximize their personal advantage.
Coterminous
means sharing the same boundaries or extent in space, time, or meaning.
Exchange Theory
A theoretical framework suggesting that social behavior is the result of an exchange process aiming to maximize benefits and minimize costs to individuals.
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