Class Notes (835,288)
Canada (509,068)
Economics (994)
ECON 101 (318)
Lecture

tax and quota.docx

4 Pages
78 Views
Unlock Document

Department
Economics
Course
ECON 101
Professor
Wokia Kumase
Semester
Fall

Description
Oct 9 Tax on sellers 1. Supply curve shifts leftward, 2. Get a new equilibrium point 3. The new equilibrium price is the price paid by buyers Draw a vertical line downward, the intersect with original supply curve: its price is the price received by sellers 4. Compare the price paid by buyers, the price received by sellers with the original equilibrium price... Tax on buyers 1. The demand curve shifts leftward 2. Get a new equilibrium point 3. The new equilibrium price is the price received by sellers Draw a vertical line, the intersect with the demand curve: its price is the price paid by buyers. 4. Compare the price paid by buyers, the price received by sellers with the original equilibrium price... Once we put a tax on either buyers or sellers, the market has underproduction and has a dead-weight loss. The consumer surplus and producer surplus are decreasing. With the same tax on either buyers or sellers, the distribution of tax between buyers and sellers are always the same. Taxes and fairness 2 principles of fairness to apply to a tax system: 1. Benefits principle People pay taxes equal to the benefits they receive from the government. This principle is good because who benefits more need to pay more taxes. 2. Ability-to-pay prin
More Less

Related notes for ECON 101

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit