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The graph below shows the market for office rental space. A $400 per month excise tax is imposed on firms selling office space. D is the demand curve, S1 is the supply curve in the absence of the tax, and S2 represents the supply curve that includes the tax. Who has the larger tax incidence? S2 O S1 Consumers (buyers) $3600 O Producers (suppliers) This excise tax falls on the above $3500 people because: The demand for office rentals is Price ($) D O more inelastic than the supply of office rentals. O For office rentals, both demand and supply are highly price elastic. The supply of office rentals is more O elastic than the demand for office rentals. $3200 The supply of office rentals is more O inelastic than the demand for office rentals. QuantityThe table shows Jennifer's marginal utility from tea and shortbread. Jennifer has $5.00 to spend each day on tea and shortbread. The price of tea is $1.00 a cup and the price of shortbread is $0.50 a piece. When Jennifer maximizes her total utility, she buys El pieces of shortbread each day and her marginal utility per dollar for shortbread is D units per dollar. Tea Shortbread Cups per Harginal Pieces per Marginal day utility day utility 0 0 1 100 2 84 2 76 4 56 3 66 6 33 4 53 8 34 5 50 1 0 30 4. Suppose the government, instead of levying the tax on producers, levies the tax on consumers for each bag of potato chips they purchase. Please shift the curve(s) to illustrate this. 5. What is the effective price paid per bag by 4.5 consumers (Pc) with this new tax? Number 3.5 3 Price 2.5 Supply No 6. What is the price received net of tax (Pp) per 1.5 bag by producers with this new tax? Number Demand 0.5 1 2 3 4 5 6 7 8 9 10 Tools Quantity x 102