| aplia econ homework.....please help!?
Suppose that the following graph represents the market for catfish in Louisiana and the effects of a recent $1.50 tax imposed by the state government on each pound of catfish sold. The purple rectangle (area A) represents the amount of government revenue generated by the tax, and the green triangle (area B) represents the deadweight loss from the tax. Before the tax is imposed, the market price for a pound of catfish is $1.75. Use the graph to answer the following questions.
Graph
http://img.photobucket.com/albums/v223/rocknskadude/1_graph_static.gif
What is the total surplus for buyers and sellers after the tax?
answer according to aplia:
The tax of $1.50 drives a wedge between the price consumers pay and the price producers receive. Consumers now face a price of $2.50, while producers face a price of $1.00. Therefore, consumer surplus is now 0.5 x ($3.25 - $2.50) x 30 = $11.25, and producer surplus is now 0.5 x ($1.00 - $0.25) x 30 = $11.25. Total surplus is $11.25 + $11.25 = $
where the hell are they getting the ".5" from?!!??
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