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Quantitative Analysis of Taxes definitions

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  • Equilibrium Price
    The value at which the quantity supplied equals the quantity demanded after accounting for any imposed tax.
  • Equilibrium Quantity
    The amount exchanged in the market where the adjusted supply and demand equations intersect post-tax.
  • Supply Curve
    A graphical or algebraic representation showing the relationship between price and quantity offered by sellers.
  • Demand Curve
    A graphical or algebraic representation showing the relationship between price and quantity desired by buyers.
  • Tax Incidence
    The division of a tax's economic burden between buyers and sellers, determined by market adjustments.
  • Shifted Supply Curve
    A new supply relationship reflecting the reduction in seller receipts due to a per-unit tax.
  • Non-Taxed Party
    The side of the market—buyer or seller—not directly responsible for remitting the tax to the government.
  • Taxed Party
    The side of the market—buyer or seller—required to remit the tax, affecting their net proceeds.
  • Supply Equation
    An algebraic expression relating quantity supplied to price, adjusted for taxes when applicable.
  • Demand Equation
    An algebraic expression relating quantity demanded to price, used to solve for market outcomes.
  • Buyer Price
    The amount paid by purchasers in the market, which may differ from the seller's receipt due to taxes.
  • Seller Price
    The net amount received by suppliers after subtracting any per-unit tax from the market price.
  • Per-Unit Tax
    A fixed amount levied on each unit sold, causing a vertical shift in the supply or demand curve.
  • Market Adjustment
    The process by which new equilibrium values are found after a policy change, such as a tax.
  • Algebraic Solution
    The method of using equations to determine new market prices and quantities after a tax is imposed.