Figure 4-8



Refer to . The supply curve S1 and the demand curve D indicate initial conditions in the market for soft coal. A $40-per-ton tax on soft coal is levied, shifting the supply curve from S1 to S2. Which of the following states the actual burden of the tax?

a.

$10 for buyers and $30 for sellers

b.

$30 for buyers and $10 for sellers

c.

The entire $40 falls on sellers.

d.

The entire $40 falls on buyers.


a

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