Find the new equilibrium price and quantity. Thus, the burden does not depend on who nominally pays the tax. Now suppose that Bill Gates decides to buy two million books per year, regardless of the price, and donate them to needy children. Graph the demand and supply curves. Find the new equilibrium price and quantity.
Supply is unchanged.
Suppliers are helped, the needy children are helped, but other book buyers are hurt because Bill s demand has raised the equilibrium price.