The following graph shows the daily market for wine. Suppose the government institutes a tax of $46.40 per bottle. This places a wedge between the price buyers pay and the price sellers receive.

Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax.

Using the data you entered in the previous table, calculate the tax burden that falls on buyers and on sellers, respectively, and calculate the price elasticity of demand and supply over the relevant ranges using the midpoint method. Enter your results in the following table.

The burden of the tax falls more heavily on the _______ elastic side of the market.

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PRICE (Dolars per bottle) 200 160 140 120 100 80 40 210, 140 Tax Wedge Supply Demand 100 150 200 250 300 350 400 450 500 QUANTITY (Bottes of wine) ? Before Tax After Tax Quantity (Bottles of wine) Price Buyers Pay (Dollars per bottle) Price Sellers Receive (Dollars per bottle) Buyers Sellers Tax Burden (Dollars per bottle) Elasticity 11 PRICE (Dolars per bottle) 200 160 140 120 100 80 40 210, 140 Tax Wedge Supply Demand 100 150 200 250 300 350 400 450 500 QUANTITY (Bottes of wine) ? Before Tax After Tax Quantity (Bottles of wine) Price Buyers Pay (Dollars per bottle) Price Sellers Receive (Dollars per bottle) Buyers Sellers Tax Burden (Dollars per bottle) Elasticity 11

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quantity price buye pay price seller receive before tax 250 100 100 after tax 21... View the full answer