Per Unit Tax

A per unit tax is a fixed tax on a product, independent of the product's price. It can be represented as a wedge between the supply and demand curves. PB indicates the price buyers pay and PS indicates the price sellers receive net of the tax. The orange rectangle represents the tax revenue (the per unit tax times the quantity sold). The consumer surplus is shaded in blue, the producer surplus in pink, and the deadweight loss in purple.


  • [Snapshot]
  • [Snapshot]
  • [Snapshot]
    • Share:

Embed Interactive Demonstration New!

Just copy and paste this snippet of JavaScript code into your website or blog to put the live Demonstration on your site. More details »

Files require Wolfram CDF Player or Mathematica.