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. 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 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. 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?
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter5: Price Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 25SQ
Related questions
Question
Assume that the monthly
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?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning
Macroeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506756
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning