Question 2 - 2P and Qs = Suppose the market demand and supply equations for flowers are Qp = 100 3P, respectively. a) Draw the demand and supply curves on a graph. Label clearly and mark the equilibrium price. b) Government imposes a £5 specific tax on sellers, what price will consumers pay? Show on the graph. c) How much tax revenue is collected by the government? Show on the graph. d) What fraction of the tax is paid by sellers?

Question 2 - 2P and Qs = Suppose the market demand and supply equations for flowers are Qp = 100 3P, respectively. a) Draw the demand and supply curves on a graph. Label clearly and mark the equilibrium price. b) Government imposes a £5 specific tax on sellers, what price will consumers pay? Show on the graph. c) How much tax revenue is collected by the government? Show on the graph. d) What fraction of the tax is paid by sellers?

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter8: Application: The Cost Of Taxation

Section: Chapter Questions

Problem 10PA

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