Suppose the government imposes a tax of $20 million per month on cable producers. If Comcast wants to maximize its profit, what price per subscription should it charge per month?
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Suppose the government imposes a tax of $20 million per month on cable producers. If Comcast wants to maximize its profit, what
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- Suppose the demand curve for gasoline is more elastic than the supply curve for gasoline. If the government imposes a tax on gas stations (gasoline sellers), which party (buyers or sellers) will bear more of the tax burden? How will the tax burden change if the government imposed the tax on gasoline consumers, rather than sellers?The city government is considering two tax proposals: • A lump-sum tax of $300 on each producer of hamburgers. • A tax of $1 per burger, paid by producers of hamburgers. a. Which of the following curves—average fixed cost, average variable cost, average total cost, and marginal cost—would shift as a result of the lump-sum tax? Why? Show this in a graph. Label the graph as precisely as possible. b. Which of these same four curves would shift as a result of the per-burger tax? Why? Show this in a new graph. Label the graph as precisely as possible.Consider the market for BP gasoline. If the market has a very elastic supply and a very inelastic demand, how would the burden of a tax on BP gasoline be shared between producers and consumers? Draw a graph to support your answer.
- What is the price firms receive after the tax is in placeSuppose the demand curve for gasoline is more elastic than the supply curve for gasoline. If the government imposes a tax on gas stations (gasoline sellers), which party (buyers or sellers) will bear more of the tax burden? How will the tax burden change if the government imposed the tax on gasoline consumers, rather than sellers? explain in simple terms.Suppose supply is P= 4 + (1/4)Qs and demand is P= 58 ―(1/2)Qd. Suppose a tax of $3 per unit is placed on the good. What is the size of the deadweight loss? What fraction of the tax is paid by producers?
- if deadweight loss is $24,000 under a tax of $4 per unit, what is deadweight loss under a tax of $2 per unit?Suppose government impose a tax of 1 dollar per bottle on sellers of industrial detergent. Explain 3 dimensions in which you can explain the effect of this tax.Suppose the supply curve for cars is more elastic than the demand curve for cars. If the government imposes a tax on car sellers, which party (buyers or sellers) will bear more of the tax burden? How will the tax burden change if the government imposed the tax on car buyers, rather than sellers?
- For this question, suppose the market for widgets is perfectly competitive and the government introduces a per-unit $1 tax on widgets. Post-tax, quantity of widgets sold in market equals 100. Why could the deadweight loss caused by the tax be greater than the tax revenue collected?Suppose there is only one movie theatre in a town and the equilibrium price and quantity for movie admissions is 7 TL and 940 visits per week. Now suppose the government imposes a tax of 3 TL per movie admission, and the new equilibrium price and quantity are 8.75 TL and 750 visits per week. What is the total burden of this tax?Consider a producer who faces a linear demand curve P = 24 – Q, where P is the price in dollar ($) and Q is the quantity demanded. The producer produces this good at a constant average and marginal cost of $6. Determine the price and quantity if the producer wishes to maximise profits. Suppose the government imposes a tax of $T per unit on the producer. How much will the consumer bear the tax burden? Explain.
