What price should the beer be now sold at


Problem

A shop currently sells cans of beer for 2. From that 2, the shop pays 1 for the costs associated with the beer (paying the brewery etc.) and makes 1 profit for each can it sells.

The government decides to put a tax of 0.50 on each can sold. What price should the beer be now sold at?

Explain the rationale behind your answer. Use a diagram if necessary.

The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.

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Microeconomics: What price should the beer be now sold at
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