(Different problem/unrelated to previous one)
After a seller-imposed gas tax of $.50/gallon, assume the new (post-tax) equilibrium price is $4.50.
What is the post-tax seller price (Ps)?
4.5
Question 8
0/1 pts
"I will build a great wall -- and nobody builds walls better than me, believe me --and I'll build them
very inexpensively. I will build a great, great wall on our southern border, and I will make Mexico
pay for that wall. Mark my words."
More recently: "President Trump's plan to make Mexico pay for the wall he intends to build on the
southern border may have taken shape Thursday, when his spokesman suggested imposing a 20-
percent import tax on Mexican goods." Suppose the 20% imported goods tax is the chosen method
to get Mexico to pay for the wall. Who will pay for the wall?
Just Mexicans: they have a perfectly inelastic supply curve and will bear the entire tax burden.
• Just Americans: we have a perfectly inelastic demand curve and will bear the entire tax burden
Americans and Mexicans: tax burdens are shared (not necessarily equally)
