WebWhen demand is more elastic than supply, producers bear most of the cost of the tax. Tax revenue is larger the more inelastic the demand and supply are. The burden of tax Depending on the circumstance, the burden of tax can … WebThe producer surplus is going to be the area of this triangle right over here. Let's see, this is $1 times 1 million times one-half. This is now a producer surplus. Producer surplus. A new producer surplus under the rent control of $500,000, half a million, of $500,000.
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