Assume that the monthly demand for Gala apple in the US is given by q=1200-300p and quantity is in million pounds. The monthly supply of Gala is q= -200+400p for p>$0.5. 1) Now assume that the government has imposed a quantity tax equal to $0.14 on each pound of apple. Assume that the retail stores are legally obliged to collect this tax. Government revenue of this tax is: 2) Now assume that the government has imposed a quantity tax equal to $0.14 on each pound of apple. Assume that the retail stores are legally obliged to collect this tax. DWL of this tax is ------million dollars. 3) Now assume that the government intend to imposed a quantity tax equal to $t on each pound of apple. What level of t will maximize the government revenue?
Assume that the monthly
1) Now assume that the government has imposed a quantity tax equal to $0.14 on each pound of apple. Assume that the retail stores are legally obliged to collect this tax. Government revenue of this tax is:
2) Now assume that the government has imposed a quantity tax equal to $0.14 on each pound of apple. Assume that the retail stores are legally obliged to collect this tax. DWL of this tax is ------million dollars.
3) Now assume that the government intend to imposed a quantity tax equal to $t on each pound of apple. What level of t will maximize the government revenue?
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