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Given the following demand and supply functions Qd = 220−5P Qs = −20+3P if a per unit tax of 8 is imposed on the commodity. i. determine the equilibrium price and quantity before the imposition of the tax. ii. determine the equilibrium price and quantity after the imposition of the tax iii. compare the results in (i) and (ii). iv. graph the results in (i) and (ii).

Given the following demand and supply functions Qd = 220−5P Qs = −20+3P if a per unit tax of 8 is imposed on the commodity. i. determine the equilibrium price and quantity before the imposition of the tax. ii. determine the equilibrium price and quantity after the imposition of the tax iii. compare the results in (i) and (ii). iv. graph the results in (i) and (ii).

Microeconomics: Principles & Policy
Microeconomics: Principles & Policy
14th Edition
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:William J. Baumol, Alan S. Blinder, John L. Solow
Chapter17: Taxation And Resource Allocation
Section: Chapter Questions
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Given the following demand and supply functions Qd = 220−5P Qs = −20+3P if a per unit tax of 8 is imposed on the commodity.

i. determine the equilibrium price and quantity before the imposition of the tax.

ii. determine the equilibrium price and quantity after the imposition of the tax

iii. compare the results in (i) and (ii).

iv. graph the results in (i) and (ii).

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