Qd Price 000) (000) $9.00 20 24 N 7.50 32 6.50 7.00 36 a E 3 36 24 Quartcity supplied after tax (0) (000) 1. What is the equilibrium price and quantity? 2. Suppose the government imposes a tax of $1.00 on each water bottle. Complete the column showing quantity supplied after the tax. (Hint: at a price of $8.00 the quantity supplied was 36000. With the tax, this quantity supplied will be supplied only at a price of $9.00, so the Quantity supplied with a tax at 9.00 is 36000) You by gets 7.50, so is ont viling to offer 32000 units
Qd Price 000) (000) $9.00 20 24 N 7.50 32 6.50 7.00 36 a E 3 36 24 Quartcity supplied after tax (0) (000) 1. What is the equilibrium price and quantity? 2. Suppose the government imposes a tax of $1.00 on each water bottle. Complete the column showing quantity supplied after the tax. (Hint: at a price of $8.00 the quantity supplied was 36000. With the tax, this quantity supplied will be supplied only at a price of $9.00, so the Quantity supplied with a tax at 9.00 is 36000) You by gets 7.50, so is ont viling to offer 32000 units
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter8: Application: The Cost Of Taxation
Section: Chapter Questions
Problem 5CQQ
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Transcribed Image Text:Qd
Price 000)
$9.00 20
8.00
7.50
7.00
24
20
32
36
6.50 40
6.00 44
Qs
(000s)
40
36
28
24
20
Quantity supplied
after tax Qu(1)
(000)
1. What is the equilibrium price and quantity?
2. Suppose the government imposes a tax of $1.00 on each water bottle. Complete the column showing quantity
supplied after the tax. (Hint: at a price of $8.00 the quantity supplied was 36000. With the tax, this quantity
supplied will be supplied only at a price of 59.00, so the Quantity supplied with a tax at 9.00 is 36000) You
continue, so at $8.50, the producer only gets 7.50, so is only willing to offer 32000 units
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