Suppose that the U. S. government decides to charge cola consumers a tax. Before the tax, 45 million cases of cola were sold every month at a price of $6 per case. After the tax, 39 million cases of cola are sold every month; consumers pay $7 per case (including the tax), and producers receive $3 per case (after paying the tax). The amount of the tax on a case of cola is___per case. Of this amount, the burden that falls on consumers isper case, and the burden that falls on producers isper case.
The effect of the tax on the quantity sold would have been larger if the tax had been levied on consumers.
A. True
B. False

$4

$1

$3

b

Explanation:

Tax is a compulsory amount levied on goods and services. Taxes increase the price of a good

The type of tax stated here is a sales tax

A sales tax is an example of consumption tax. It is levied on the sales of goods and services

Tax on the case of cola = Amount paid by consumers after tax - amount received by producers

7 - 3 = 4

Tax paid by consumers = amount paid by consumers after tax - amount paid before tax

$7 - $6 = $1

Tax paid by suppliers = 4 - 1 = $3

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answer; at prices that violate government price regulations;