Figure 6-6
A TAX ON BUYERS. When a tax
of $0.50 is levied on buyers, the
demand curve shifts down by
$0.50 from D1 to D2. The
equilibrium quantity falls from
100 to 90 cones. The price that
sellers receive falls from $3.00 to
$2.80. The price that buyers pay
(including the tax) rises from
$3.00 to $3.30. Even though the
tax is levied on buyers, buyers
and sellers share the burden of
the tax.