Question

whole number. a. Before the tax is imposed, the equilibrium price is $ 1.5 per bottle and the equilibrium quantity is 4 billion bottles. b. After the excise tax is imposed, consumers pay a price of $ 2 per bottle.c. After the excise tax is imposed, the price (or amount) producers keep after the tax is paid is $ per bottle.After the tax is imposed, the equilibrium quantity is 3 billion bottles.e. The government is able to collect $ billion of tax revenue from the tax.

Answer 1

Answer: hello your question is poorly structured attached below is the missing graph and missing part of the question

Assume the government imposes a $1.00 excise tax on the sale of every 2 liter bottle of soda. The tax is to be paid by the producers of soda. The figure below shows the annual market for 2 liter bottles of soda before and after the tax is imposed.

answer :

a) $2 , 4 billion

b) $2.5

c) $1.5

d) 3 billion

e) $3 billion

Explanation:

a) equilibrium price = $2 per bottle

   equilibrium quantity = 4 billion bottles

b) After imposition of excise tax

consumers will pay = $2.5

c) The amount producers keep after the imposition of taxes

= $2.5 - tax

= 2.5 - 1 = $1.5

d) New equilibrium quantity ( after tax is imposed )

= 3 billion bottles ( from graph attached ) i.e. intersection of S2 and D

e) Amount of tax revenue collected by the government from the imposition of tax

= quantity  of bottles sold  * $1

= 3 billion * $1 =  $3 billion