Suppose that a market is described by the following supply and demand equations: Qs = 2P, Qd = 300 - P Suppose that a tax of T is placed on buyers, so the new demand equation is Qd = 300 - (P + T) d) Solve for deadweight loss as a function of T.
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- Demand for apples is given by the function P=50-4q while supply is given by P=10+q. If a per-unit tax of $15 is placed on apples, What is new price after tax?the inverse demand function for mangos is p=6-0.5q, where q is the number of crates that are sold. The inverse supply function is p=q. In the past there was no tax on mangos but now a tax of 3$ per crate has been imposed on suppliers. What are the quantities produced before and after the tax was imposed? How much tax is raised?Suppose that in a certain market the demand function for a product is given by p =−8q + 2800 and the supply function is given by p = 3q + 45. Then a tax of $5 per itemis levied on the supplier, who passes it on to the consumer as a price increase. Findthe equilibrium price and quantity after the tax is levied.
- The demand and supply equations for a product are: Q= 300 — 6P and Q.= -40 + 6P. Determine the market equilibrium and draw graphs. Suppose that the government decides to impose a flat tax of 10% on each unit sold. Show that the price that consumers pay would be the same if the government imposed a tax of Rs. 1.70 per unit sold. Draw graphs and Also calculate the total revenue earned by sellers before and after the tax, the tax revenue raised by the government, changes in consumer and producer surplus, and deadweight loss.The demand (D) and supply (S) function for a commodity are P =100 – 2Q and P = 10 + Q, respectively. (a) Find the equilibrium price and quantity. That is, find the price and quantity where the D and S functions intersect. (b) A new 10% tax is imposed on this commodity. Find the burden of the tax on demanders and the burden on suppliers. Also find the total taxes.The demand (D) and supply (S) function for a commodity are P =100 – 2Q and P = 10 + Q, respectively. (a) Find the equilibrium price and quantity. That is, find the price and quantity where the D and S functions intersect. (b) A new 10% tax is imposed on this commodity. Find the burden of the tax on demanders and the burden on suppliers. Also find the total taxes. [In order to insure that we all do this problem in the same way, let’s assume that the tax is imposed on the supply side of the market. In addition, the burden of the tax on demanders is the difference in price demanders pay when the tax is in existence less the price they paid when there was no tax. The burden on suppliers is the difference in price suppliers received when there was no tax and the net price (after remitting tax to the government) they receive when the tax is in existence.]
- Demand for apples is given by the function P=50-4q while supply is given by P=10+q. If a per-unit tax of $15 is placed on apples, what will be the new equilibrium quantitiy?Suppose that the demand and supply functions for a good are given as follows: Demand: 0-720-8P Supply: Q =-160 + 3P What is the price elasticity of demand at the equilibrium when there is no tax? 0.5 1.25The demand function for beef is Qd = 100 – 3P and supply function for beef is Qs = 10 +2P. Price elasticity of demand is – 0.1 and price elasticity of supply is 0.02. ii. Calculate new price of beef in the market when government introduces a specific tax of N$0.25 per kg.
- The coconut oil demand function (Buschena and Perloff, 1991) is Q= 1,200 - 9.5p + 16.2p, + 0.002Y, where Q is the quantity of coconut oil demanded in thousands of metric tons per year, p is the price of coconut oil in cents per pound, p., is the price of palm oil in cents per pound, and Y is the income of consumers. Assume 50e per pound, p, is 31¢ per pound, and Q is 1,330 thousand metric tons per vear. Calculate the income elasticity of demand for coconut oil. The income elasticity of demand for coconut oil is (Enter a numeric response using a real number rounded to three decimal places.) tv Help Me Solve ATa ck Answ MacBook Air 80 DI DD esc F1 F2 F3 F5 F6 F7 F8 F9 F10 F11 F12 @ $ % & 1 2 3 4 5 6 7 8 9 { Q W E T Y U P tab A H K ..Example 2: In fall of 2011, the National Christmas Tree Association decided to impose a fee/tax of $0.15 per tree sold.² They claimed the tax revenue raised would fund a new marketing campaign for Christmas tree growers in response to growing plastic tree imports. The proposal quickly drew controversy: some argued that the fee/tax would be passed along in higher prices to consumers, but the National Christmas Tree Association says no. How does the answer to this question depend on the assumption about the price elasticity of demand? a. Consider two graphs of the market for Christmas trees. The supply curve in each market is assumed to be the same. In the left graph, assume the price elasticity of demand is relatively inelastic and in the right graph, assume the price elasticity of demand is relatively elastic. Add labels on your diagram to identify the equilibrium price and quantity of trees before the tax. b. Now, suppose retailers are assessed a tax of amount for each tree sold.…The demand (D) and supply (S) function for a commodity are P=100 - 20 and P = 10 + Q, respectively. (a) Find the equilibrium price and quantity. That is, find the price and quantity where the D and S functions intersect. (b) A new 10% tax is imposed on this commodity. Find the burden of the tax on demanders and the burden on suppliers. Also find the total taxes. [In order to insure that we all do this problem in the same way, let's assume that the tax is imposed on the supply side of the market. In addition, the burden of the tax on demanders is the difference in price demanders pay when the tax is in existence less the price they paid when there was no tax. The burden on suppliers is the difference in price suppliers received when there was no tax and the net price (after remitting tax to the government) they receive when the tax is in existence.]