Consider a perfectly competitive market with our usual downward sloping demand and upward sloping supply curves. The market has a $2 per-unit tax that consumers pay. This tax is decreased to a $1 per-unit tax. Which of the statement is TRUE about the market equilibrium with the lower $1 tax. O Consumer surplus decreases because market price rises. O Tax revenues increase. O Tax revenues decrease.
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- Consider any market where the Supply Curve is given by O = 25 + 0.2P and the Demand curve is given by 500-0.3P Ask: a) Calculate prices and equilibrium quantity of this market b) Consider that this market operates with prices equal to 900.00. What's happening? c) Regarding the result found in (b), consider the impacts of a change in the supply curve to O = 50+0.2P. Discuss the results and plot the fit graphs on the supply curves.Consider in perfectly competitive market the following demand and supply equations for sugar:Qd =1000-1000p where Q d is quantity demanded and Qs is quantity supplied. Qs=800+ 1000p Where P is the price of sugar per pound and Q is thousands of pounds of sugar. (a) Suppose that the government wishes to subsidize sugar production by placing a floor on sugar prices of $0.20 per pound. What would be the relationship between the quantity supplied and quantity demand for sugar?(b) Identify market problem specifically at prices 0.2 per pound and what will be scientific recommendation you suggest to solve the identified market problem?20. Which of the following would increase the short-run supply for a business, regardless of market structure? A-An income tax on consumers. B-A transfer payment. C-A lump-sum production subsidy D-A per-unit production subsidy. E-An excise tax 21.How would the creation of an import quota affect the market for a good? A-Imported supply increases. B-Domestic supply decreases. C-Market price increases D-Consumer surplus increases. E-Producer surplus decreases
- In the free-market equilibrium of a perfectly competitive market, the price of the good is 90 dollars and the elasticity of demand and the elasticity of supply values are respectively Ed* = -6.6 and Es* = 4.1 Suppose the government imposes a per-unit tax equal to 10.4 payable by consumers. Calculate the estimate of the price firms charge consumers in the tax equilibrium using the elasticity values provided above. Then enter that price value below.Only typed answer Each firm in a competitive market has a cost function of C(q) = q − q 2 + q 3 . The market has an unlimited number of potential firms. The market demand function is Q = 24 − P. a. Determine the long-run equilibrium price, the quantity per firm, the market quantity, and the number of the firms. b. How do these values change if a tax of $1 per unit is collected from each firm? c. How would these values change if instead of a tax the government implements a price floor of 30?In a perfectly competitive market, market demand is Qd(P)=209–3×P while market supply is Qs(P)=6×P–2. If the current market price is $12, what is the difference between quantity demanded and quantity supplied? Important: A positive number means excess demand, a negative number means excess supply, and 0 quantity supplied equals quantity demanded.
- Consider the perfectly competitive market for an agricultural commodity. The direct market demand curve is Q(P) = 720 − 15P and the direct market supply curve is Q (P) = 15P. The market equilibrium quantity is 360 units at a price of $24. Suppose the government imposes a price floor at P = $36.00 and uses a deficiency payment program to implement the floor. What quantity will be sold and what prices will consumers and producers face under this policy? The new equilibrium quantity is 540 units. Consumers pay $12 and the producers receive $36. Find the: a. Change in consumer surplus and producer surplus. b. Government Expenditure. c. Change in social surplus.The market demand and supply equations for a product of a perfectly competitive industry. Qd=60-10P Qs=30+2.5P Where Q is quantity and P is price. Required: i.What is the equlibrium price and quantity? ii.Suppose that an increase in income resulted in the new demand equation Qd=80-10P What is the new equilibrium price and quantity? Suppose the government enact a legislation that imposes a price equivalent to the original equilibrium price.What kind of price legislation is this?Explain two implications of such a price control.The market for mandrake root in Sodden is perfectly competitive. Market demad is given by Q = 477 - 3P and market supply is given by Q = 3P. the government is concerned about the high prices and imposes a price ceiling of $7. What is the quntitiy traded in the market with this price ceiling? Enter a number only.
- Suppose that bicycles are produced by a perfectly competitive, constant-cost industryWhich of the following will have a larger effect the long-run price of bicycles: a government program to advertise the health benefits of bicyclingor (2) a government program increases the demand for steel, an input in the manufacture of bicycles that is produced in an increasing cost industry ? O. Option 1: shifts the demand curve out and increases the price. O. Option 2: shifts the supply curve up and increases the price O. Option 2: it shifts the demand curve up and increases the quantity. O. Option 2: shifts the supply curve up and increases the quantity.Consider the market for electronic components ("chips") and assume that there is complete competition.1a) Graph the short-run market equilibrium in a supply-demand diagram. 1b) Due to entry restrictions, there are long waiting times and thus supply passports. Show what impact these supply bottlenecks have on the market for electric cars. For this purpose, graphically represent the situation with and without supply bottlenecks in a supply-demand diagram. Label the old and new market equilibrium as well as the new and old consumer and producer surplus. Be sure to include the necessary labels in your diagram. 1c) Since the effects on the market for electric cars related to the supply bottleneck are not desirable from a macroeconomic perspective, the government is considering intervening with economic policy measures. In your diagram from 1b), show why the effects addressed are not desirable from a macroeconomic perspective. Also explain this briefly in the text or annotated keywords.1d)…The wheat market is perfectly competitive and the market supply and demand curves are given by the following equations: QD = 20,000,000 - 4,000,000PQS = 7,000,000 + 2,500,000P,where QD and QS are quantity demanded and quantity supplied measured in kilogram (kg), and P = price per kg. question: a) Assume that the government has imposed a price floor at $2.25 per kg and agrees to buy any resulting excess supply.How many quantity (kg) of wheat will the government be forced to buy?Determine consumer surplus with the price floor.