Suppose the Canadian government has decided to place an excise tax of $20 per tire on producers of automobile tires. Excise taxes are also called sales or commodity taxes. Previously, there was no excise tax on automobile tires. As a result of the excise tax, producers of tires, such as Bridgestone and Michelin, are going to alter their tire prices. The graph illustrates the demand and supply curves for automobile tires before the excise tax. Please shift the appropriate curve or curves on the graph to demonstrate the new equilibrium. What is the price consumers pay for a tire post tax? Round to the nearest 10.
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Suppose the Canadian government has decided to place an excise tax of.docx
1. Suppose the Canadian government has decided to place an excise tax of $20 per tire on
producers of automobile tires. Excise taxes are also called sales or commodity taxes. Previously,
there was no excise tax on automobile tires. As a result of the excise tax, producers of tires, such
as Bridgestone and Michelin, are going to alter their tire prices. The graph illustrates the demand
and supply curves for automobile tires before the excise tax. Please shift the appropriate curve or
curves on the graph to demonstrate the new equilibrium. What is the price consumers pay for a
tire post tax? Round to the nearest 10.
