For this question, the demand is P = 145 - 3Q & supply is P = 35 + 2Q. To enable more citizens to buy more gasoline, the Government decides to give gasoline producers a subsidy of $5 per unit- Using the supply and demande quations from #2. What price will consumer's pay and how much gasoline will they buy (note the answersm ay be fractions or in decimal points)? How much will the Government spend on the subsidy? What will be the change in producer surplus?
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For this question, the demand is P = 145 - 3Q
& supply is P = 35 + 2Q.
To enable more citizens to buy more gasoline, the
Government decides to give gasoline producers a subsidy of $5 per unit- Using the supply and demande quations from #2. What price will consumer's pay and
how much gasoline will they buy (note the answersm ay be fractions or in decimal points)? How much will the Government spend on the subsidy? What will be the change in
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- The equation of demand is Q=10000-5p, supply is Q=-2000+10p Q represents the quantity of houses on the market and P the rental price. The equilibriumrental price equals 800 euros per month. if the government increase the supply of rental houses, by building 3,000 extra houses,What are the effects of each measure for both house owners and people renting ahouse? And what are the consequences for the government? Analyse the measuresgraphically and mathematically.Suppose the market demand and supply curves are as given below. In each case, quantity refers to milions of litres of gasoline per month; price is the price per litre (in cents). Pa400 - 240 Supply: P= 160 + 80 Given these demand and supply equations, the equilbrkum price is 220 cents and the equilibrium quantity is 7.5 milion litres. Suppose the government imposes a tax per itre, and as a result the quantity sold is 5.8 million litres. What is the new "consumer price" and what is the new "producer price"? The new price consumers pay is 260.8 cents. (Enter your response rounded to the nearest cent.) The new price producers receive is cents. (Enter your response rounded to the nearest cent.)The demand for gasoline is P= 4 – 0.002Q and the supply is P= 0.4 + 0.004Q, where Pis in dollars and Qis in gallons. Instructions: Round your answer to the nearest penny (2 decimal places). If a tax of $0.8/gallon is placed on petrol, what is the incidence of the tax? Tax incidence to the consumer: $ Tax incidence to the supplier: $ Instructions: Round your answers to the nearest whole number. What is the lost consumer surplus? $1 What is the lost producer surplus? 24
- The equilibrium price of a good is $30. Supply of this good is more elastic than demand. 5uppase the government introduces a tax on the good. in this case, the price receved by producers is $24, and the price paid by consumers is 1.6 times more.Calculate the tax cost per good for the group bearing most of the tax burden if necessary, round any intermediate calculations and your final answer to two decimal places. $______Suppose the supply and demand curves for a particular product are given by:QS = -20 + 2P QD =100 - 2Pwhere QS and QD are quantities in units and P is the price per unit. Suppose the government implements a price ceiling of $20/unit in this market. Is this price ceilingbinding on the market? What are the quantities demanded and supplied at the price ceiling? Howmany units are exchanged at this price? Given the effects of the policy, is there a potential forillegal trade? Briefly explain your answers where necessary.QD=50 – 2 P + 0.5 PR and Qs = -4 + P. Here PR if the price of a related good. What is the equilibrium price and quantity if PR =Rs. 10? Plot the demand and supply curve and show the equilibrium in the same plot. If govt. imposes tax on the related good by Rs.2 per unit, then how the equilibrium will change? Do buyers of the commodity bear the whole burden of the excise duty?
- The market for skateboards currently has no taxes. The equilibrium quantity is 5,000/month, and the equilibrium price is $40. The governor is considering placing a $10/skateboard tax on skateboard producers, and expects to raise $50,o00/month in revenue. Is the governor correct? O Yes, because producer and consumer responses will cancel out. O No, because the quantity produced and consumed will fall below 5,000/month once the tax is imposed. O No, because it doesn't matter whether the consumer or producer is taxed. O Yes, because 5,000 x $1O = $50,000.1. Suppose that the market demand for coffee is Pd = 15 - Qd and the market supply is Ps= Qs - 5. What is the equilibrium price and quantity for coffee? Suppose that the government imposes a tax of $1 per unit to reduce coffee consumption and raise government revenues. What will be the new equilibrium quantity? What price will the buyer pay? What price will the seller receive? A o F2 BE #3 ㅁㅁ F3 $ A t 4 OFFIC DEO DOD 000 F4 % 5 F5 MacBook Air 6 F6 & 7 L * 81. Assume that the demand for cigarettes is Qd=1600-30P and the supply of cigarettes is Qs=1400+70P: a. Calculate the equilibrium price and quantity and show them on a supplyand demand diagram. b. Suppose the government levies a $2 tax for each unit of cigarettes sold.Draw this on the diagram and calculate the new equilibrium price andquantity. c. Calculate the price elasticity of demand given these two price andquantity points. Is the demand for cigarettes price elastic or inelastic onthis part of the demand curve? Interpret the elasticity in words (i.e. If theprices rises by 10%, by what percentage will consumption fall?) d. On a graph, identify the tax revenue generated by this tax. e. Indicate each area on the graph with a letter and show in a table theconsumer surplus and the producer surplus before and after the tax. Also,indicate the deadweight loss associated with this tax. f. If your policy advisor boss wanted you to provide him/her witharguments in favor of this cigarette…
- What effect does a per-gallon tax on gasoline have on the market for gasoline? Who pays for the increase in tax?Suppose that the government wishes to encourage the manufactureand sale of small cars. The current supply and demand of small carsare: Qs = −(10/9) + (1/9)P; Qd = 100 − P, where Q is in millions ofcars and P is in hundreds of dollars.Now, suppose that the government is considering two alternative plansfor encouraging small car sales. Under Plan A, every car manufacturerwill receive a $500 rebate from the government for each car sold. Underplan B, every purchaser of a small car will receive a $500 rebate fromthe government.Which of the plan is more effective in encouraging sales? Show bycomputing the equilibrium quantity under each plan.The government decides to reduce air pollution by reducing the use of petrol. It imposes £0.50 tax for each litre of petrol sold.a. Should it impose this tax on petrol companies or motorists? Explain carefully, using a supply and demand diagram. b. If the demand for petrol were more elastic, would this tax be more effective or less effective in reducing the quantity of petrol consumed? Explain with both words and a diagram.c. Are consumers of petrol helped or hurt by this tax? Why?d. Are workers in the oil industry helped or