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- Federal excise taxes on gasoline vary widely across the developed world. The United States has the lowest taxes at USD $0.40 per gallon (or £0.07 per liter), Canada has taxes of $0.60 per gallon, Japan and much of Europe is $2.00 per gallon, while Britain has the highest tax at $2.83 a gallon or £0.5 per liter. If gasoline taxes are intended to reduce the time losses from road congestion in urban environments and gasoline pre-tax costs about £0.40 per liter, why might the optimal tax in Canada be 50 percent higher than in the United States? What would be an explanation for why adjacent countries would have such different estimates of the price elasticity of demand for auto driving?16Given the following information QD = 240-5P QS= P Where QD is the quantity demanded, Qs is the quantity supplied and P is the price. Calculate the producer surplus before tax.Q4: Consider the market (supply and demand) for Wheat.Qd = 100 - 0.6P…………1Qs = -30 + 2P……...…...2a. Find the market equilibrium price and quantity?b. Find the market equilibrium price and quantity After imposing an ad valorem tax on production by 5% of good price.c. Find the market equilibrium price and quantity if producers receive a production subsidy of 10 SR per unit produced.
- The Australian government have suggested that they might need to increase GST to help fund the COVID-19 rescue package. GST is a tax on goods and services usually paid at the point of sale. Consider the market for bread. Suppose a loaf costs $4.15 and includes a 15-cent tax per loaf. 2. What determines how the tax burden is shared between buyers and sellers?Calculate the before tax consumer surplus, producer surplus, and social welfare. P = 20 - .01Qd P = .005Qs + 5Given the demand and supply equations : P + 1/2QD = 10 3P - Qs = 17 a) Find the equilibrium price and quantity. b) Tax of $2 per good is imposed, find the new equilibrium price and quantity. c) Find the extra pay by the supplier and government tax revenue.
- The annual demand for imported oranges is given by the following equation:QD = 600,000 − 30,000Pwhere P is the price per kilogram and QD is quantity of kilograms demanded per year.The supply of imported oranges is given by the equation:QS = 20,000P Calculate the following: i. the excess burden of the taxDemand function of Commodity X: 2Qx = 2200 - Px • Supply function of commodity X: Qx = - 300 + 3 Px • Sales tax per unit = 150. • Calculate: • A. Total surplus before and after tax. • B. Total welfare loss, government revenue and excess-burden = DWL • C. Draw the graph completely.iven the following information QD = 240-5P QS= P Where QD is the quantity demanded, Qs is the quantity supplied and P is the price. Suppose the government decides to impose a tax of $12 per unit on sellers in this market. Determine the total surplus after tax.
- Assume that demand and supply for a product over a period of time, respectively, are: Qdx = 15 - 0.5Px and Qsx = 0.25Px - 3. (a) Calculate the equilibrium price and quantity. Clearly show your steps and manual calculations. (b) Quantify and discuss the impact of imposing a price of $20 per unit on the market, including the full economic price paid by consumers. Clearly show your steps and manual calculations. (c) If government should impose a $8 excise tax on the product, determine the new equilibrium price and quantity. Clearly show your steps and manual calculations. Graphically illustrate your answer. (d) Calculate the amount of tax revenue that government would earn with $8 excise tax. Clearly show your steps and manual calculations. Graphically illustrate and carefully discuss the impact of substantial inflationary expectations on the market equilibrium conditions (equilibrium quantity and price) of automobiles in the United States. Consider the situation presented in Question…Assume that demand and supply for a product over a period of time, respectively, are: Qdx = 15 - 0.5Px and Qsx = 0.25Px - 3. (a) Calculate the equilibrium price and quantity. Clearly show your steps and manual calculations. (b) Quantify and discuss the impact of imposing a price of $20 per unit on the market, including the full economic price paid by consumers. Clearly show your steps and manual calculations. (c) If government should impose a $8 excise tax on the product, determine the new equilibrium price and quantity. Clearly show your steps and manual calculations. Graphically illustrate your answer. (d) Calculate the amount of tax revenue that government would earn with $8 excise tax. Clearly show your steps and manual calculations.Q3: Consider the market for pineapples in a small island nation.Qd = 80 - 2P…………1And Qs = 20 + 3P………...2a. What is the market equilibrium price and quantity?b. Suppose the government imposes a per unit tax of $6 on consumers, find the new market equilibrium? ( show your answers)c. What is the tax share tolerated by each consumer and producer.
