The government decided to impose a new tax equal to $100 on students who take BADM....
The government decided to impose a new tax equal to $100 on students who take BADM. The price of the class for students is now $1100. What is the difference in the price paid by students and the price received by the university for BADM?
Homework Answers
Imposition of tax causes consumer surplus to decrease; however the producer surplus (profit) remains unchanged as the tax is imposed only on the students and the burden is only on them as supply is more elastic than demand. The differential in the price paid by students and the price received by the university will equal to the taxes
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The government decided to impose a new tax equal to $100 on
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