Professional Documents
Culture Documents
Janasfer
Janasfer
The graph in this spreadsheet shows a demand curve and (normally) two
supply curves. The lower supply curve shows the price that the firms will
receive; the upper supply curve shows the price that they would need to
charge consumers to have this amount left over after paying the tax. The
vertical gap between the two is thus equal to the amount of tax, and if the tax
is set to zero, the two supply curves coincide.
The slider by the vertical axis changes the tax per unit sold. The horizontal
slider changes the horizontal intercept of the demand curve, and thus its
slope. You could use the yellow boxes to change the slope of the supply
curve and the vertical intercepts, but I dont recommend doing so the curves
might then obscure information on the graph.
Look at the elasticities of demand and supply (measured at the pre-tax price
and quantity) in S15 and S17. Compare them to the loss to consumers and
the loss to producers in F6 and F7.
Use the horizontal slider to change the slope of the demand curve.