Governments often place so-called sin taxes on goods or services such as cigarettes, politicians because they...

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Governments often place so-called sin taxes on goods or services such as cigarettes, politicians because they are usually more palatable to voters than income taxes To understand the effect of such a tax, consider the monthly market for alcohol, and pornography. These kinds of taxes are popufar with cigarettes, which is shown on the following graph. Use the graph input tool to help you answer the folowing questions. You will not be graded on any changes you make to this graph. e: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly Graph Input Tool 20 Market for Cigarettes 48 12.00 Supply Price 4.00 Demand Price (Dollars per pack) 8.00 Dolars per pack) Tax Wedge (Dolars per pack) 12243048 60 72 84 96 120 QUANTITY (Packs)

Suppose the government imposes a $4-per-pack tax on suppliers. At this tax amount, the equilibrium quantity of cigarettes is packs, and the government colects5 in tax revenue. Now calculate the governments tax revenue if it sets a tax of so, s the green points (triangle symbol) to plot total tax revenue at each of those tax levels Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. the tar, adjust the Quantny held undl heWedige equals the value of the per-unt taxUig the dta you generate plot Laffer arve by using 300 270 240 210 Laffer Curve 150 120 2 468 10 12 14 16 18 20 TAX (Dollars per pack)

Suppose the government is currently imposing a $12-per-pack tax on cigarettes. True or False: The government can raise its tax revenue by decreasing the per-unit tax on cigarettes O True OFalse Consider the deadweight loss generated in each of the following cases: no tax, a tax x of $8 per pack, and a tax of $16 per pack

loss generated in each of the folloming cases: no tax, a tax of s8 per pack, and a tax of s16 per pack On the following graph, use the black curve (plus symbols) to imustrate the deadweight loss in these cases. (Hint: Remember that the area of a triangle is equal to × Base x Height. In the case of a deadweight loss triangle found on the and the height is the reduction in quantity caused by the tax.) graph ingut tool, the ble s the arount dee tas 336 0 2 46810 1214 16 18 TAX (Dolars per packy As the tax per pack increases, deadweight loss

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2.0 l 2D 48 60 0 48 paukaua ご 1 6o At Cg.4iし.bnusu T4x Revenue = 8x3t ー-23-3. 60 120 15 0 30 60 t12 At tE12 16 Tax R 264 4 24 60 2o ta lb At t 16 12 92 Dp 0 12 60 Dp 60 360 8o 5 0 60 6 2__y_一6 8 10 12 14161320 TAx e Sttement is TRUE. 14 -10 12 x8 96 60 2 18 0 12) (18-_ 34 2 60 20 8 12

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4. The Laffer curve Governments often place so-called sin taxes on goods or services such as...

4. The Laffer curve Governments often place so-called sin taxes on goods or services such as cigarettes, alcohol, and po...

Governments often place so-called sin taxes on goods or services such as cigarettes, alcohol, and pornography

4. The Laffer curve Governments often place so-called sin taxes on goods or services such as...

4. The Laffer curve Governments often place so-called sin taxes on goods or services such as...

4. The Laffer curve Governments often place so-called sin taxes on goods or services such as ciga...

4. The Laffer curve Governments often place so-called sin taxes on goods or services such as...

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Governments often place so-called sin taxes on goods or services such as cigarettes, politicians because they...

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