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  3. 6 who should pay the tax the following graph shows...

Question: 6 who should pay the tax the following graph shows...

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6. Who should pay the tax? The following graph shows the labor market for research assistants in the fictional country of Collegia. The equilibrium wage is $10 per hour, and the equilibrium number of research assistants is 250 Suppose the government has decided to institute a $4-per-hour payroll tax on research assistants and is trying to determine whether the tax should be levied on the employer, the workers, or both (such that half the tax is collected from each side) Use the graph input tool to evaluate these three proposals. Entering a number into the Tax Levied on Employers field (initially set at zero dollars per hour) shifts the demand curve down by the amount you enter, and entering a number into the Tax Levied on Workers field (initially set at zero dollars per hour) shifts the supply curve up by the amount you enter. To determine the before-tax wage for each tax proposal, adjust the amount in the Wage field until the quantity of labor supplied equals the quantity of labor demanded. You will not be graded on any changes you make to this graph. Note once you enter . value in a white neie, the grap and any co responding amounts in each grey el wil change accordingGraph Input Tool Market for Research Assistants 20 18 16 Wage (Dollars per hour) 4 Labor Demanded Supply Munber or modters) 625wnbeo worers) Labor Supplied (Number of workers) 0 Demand Shifter Supply Shifter 2 Demand Tax Levied on Employers (Dollars per hour) Tax Levied on 8 0 Workers (Dollars per hour) 0 50 100 150 200 250 300 350 400 450 500 LABOR (Number of workers)For each of the proposals, use the previous graph to determine the new number of research assistants hired. Then compute the after-tax amount paid by employers (that is, the wage paid to workers plus any taxes collected from the employers) and the after-tax amount earned by research assistants (that is, the wage received by workers minus any taxes collected from the workers) After-Tax Wage Paid by Employers (Dollars per hour) After-Tax Wage Received by Workers (Dollars per hour) Tax Proposal Levied orn Employers (Dollars per hour) Quantity Hired (Number of workers) Levied on Workers Dollars per hour) 0 4 0 Suppose the government doesnt want to discourage employers from hiring research assistants and, therefore, wants to minimize the share of the ta:x paid by the employers. Of the three tax proposals, which is best for accomplishing this goal? The proposal in which the entire tax is collected from workers The proposal in which the tax is collected from each side evenly The proposal in which the tax is collected from employers None of the proposals is better than the others

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