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Excise equation charter

Excise equation charter easily

Aug 6th, 2022

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How to excise equation charter

4.8 out of 5

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so in this video were going to look at the effect of a sales tax on equilibrium so just to start out well find equilibrium without the sales tacking tax instituted yet so I will just set quantity supplied and quantity demanded equal to each other which will be 2 P equals 30 minus be adding the P to the other side we get a 3 P equals 30 which means P equals 10 and plugging that back in we can get quantity equals 20 so I will just fill this in on the graph over here our equilibrium point we get quantity is 20 and our price equals 10 so thats without the sales tax but lets say the government decides to add a sales tax of 3 dollars to whatever good were selling here so sales tax taxes affect the supply curve and they do it by shifting it left or up or inward whatever you want to call it so how does this affect the equation instead of having just P as our variable we add a minus T for the minus tax so the important thing to keep in mind is were keeping the parentheses around this P m

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