Question: Return to the base case in question 2, and consider the effects of an excise tax of 5 cents per head of iceberg lettuce, collected

 Return to the base case in question 2, and consider the

Return to the base case in question 2, and consider the effects of an excise tax of 5 cents per head of iceberg lettuce, collected from producers. Draw a new supply and demand diagram to illustrate the effects of the tax, and recalculate each of the variables listed in question 2. In addition, calculate the tax revenue raised. Report your results in the table. Describe the effects on welfare of consumers and producers from introducing this tax. Suppose, as an alternative to the excise tax, a sales tax of 5 cents per head of lettuce is collected from buyers. Report the effects in the table. Compare the producer, consumer, taxpayer, and total welfare effects of the sales tax and the excise tax from question 4. If it helps, draw a supply and demand diagram to illustrate your answer. Identify ve important events in the history of US. agricultural policy and, for each of your ve events, say why it was important. Please note that constant dripping wears a stone, and brevity is the soul of wit. Penalties will be imposed for excessively long answers

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