Refer to the graph provided. Assume the government has imposed an excise tax of $60 on producers in this market.
1 point: 1,000
1 point: $90
1 point: Consumer surplus will decrease by $45,000, from ½ ($2,000 × 60) = $60,000 before the tax to ½ ($1,000 × 30) = $15,000 after the tax.
1 point: Producer surplus will decrease by $45,000, from ½ ($2,000 × 60) = $60,000 before the tax to ½ ($1,000 × 30) = $15,000 after the tax.
1 point: $60 × 1,000 = $60,000
1 point: ½ × $60 × 1,000 = $30,000