Sent by a reader:
(Click to enlarge.)
Some questions for the economics students:
- Which vertical line segment illustrates the carbon tax revenue?
- Which vertical line segment illustrates the compensation paid by the government?
- Where does the difference come from?
- What difference would it make if you changed the axis labels from “Polluting Products” and “Non-Polluting Products” to “Watermelon” and “All Things That Are Not Watermelon”?