In Sucrosia, the supply curve for sugar is as follows: Price (per 100 pound bag) Quantity $30

Question:

In Sucrosia, the supply curve for sugar is as follows:

Price (per 100 pound bag) Quantity

$30 ……………………….. 10,000

$50 ……………………….. 15,000

$70 ……………………….. 20,000

Under pressure from nutrition activists, the government decides to tax sugar producers with a $5 tax per 100 pound bag. Using the figure above, draw the new supply curve. After the tax is enacted, what price will bring forth quantities of 10,000? 15,000? 20,000? Give your answers in the table.

Price (per 100 pound bag) Quantity

…………………………… 10,000

…………………………… 15,000

…………………………… 20,000