Suppose there is a potential for the United States to go to war. The supply curve is given by W-100. a. Congress authorizes a draft of 500,000 individuals. Draw this set up and calculate the cost to the tax payer if each member of the military is paid $25.
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- During a discussion several year; ago on building a pipeline to Alaska to carry natural gas, the U.S. Senate passed a bill stipulating mat there should be a guaranteed minimum price for the natural gas that would flow through line pipeline. The thinking behind the bill was that if private firms had a guaranteed price for their natural gas, they would be more willing to drill for gas and to pay to build the pipeline. Using the demand and supply framework, predict the effects of this price floor on fine price, quantity demanded, and quantity supplied. With the enactment of this price floor for natural gas, what are some of the likely unintended consequences in line market? Suggest some policies other than the price floor that he government can pursue if it wishes to encourage drilling for natural gas and fur a new pipeline in Alaska.how is the price of Fertilizer determined? we know that the price of a good is formed from the interaction of supply and demand. Producers will not sell a good below the cost of production. Demand changes the price due to competition; more demand drives the price up, less demand brings the price down. when you discuss how the price is determined: Taxes: is the good taxed? (e.g. cigarettes have a high tax) Costs of production: (resources, labor, etc.) Transportation Competition: is the good in high demand? Give a summary of the factors that go into the price of the good.I have a picture of the question added as well as a photo from my Econ book. The photo in my book shows how the supply curve, when vertical, the deadweight loss from a tax is small.  this is why I chose option a. Because wouldn’t that mean it would raise a small amount of tax revenue? Or would that mean that tax revenue would be larger-because deadweight loss is smaller? 
- Suppose the California legislature passed a sweeping law to lower the number of regulations for building homes such as increasing the parking requirements and setback requirements. Suppose there is a housing tax. a. What is the effect of this law on the PES for housing? b. What effect would this law have on the tax burden for buyers?Using the following diagram (the equilibrium quantity is 5.5, the supply curve intersects the price axis at 3.5), answer these questions: a) If a tax of $2 were imposed, what price would buyers pay, and what price would suppliers receive? How much revenue would be raised by the tax? Compute the total consumer surplus, producer surplus, and welfare after the introduction of the tax. b) If a subsidy of $5 were imposed, what price would buyers pay, and what price would suppliers receive? How much would the subsidy cost the government? What would be the consumer surplus and the producer surplus? c) If the government imposed a binding price floor of $7 and compensated the producers by buying the excess surplus at the stated price: What would be the consumer surplus, the producer surplus, the government expenditures, and total welfare?Sefronia and Bella share an apartment and they are deciding whether or not to purchase a weekly housecleaning service. The value of the service to each of them is $50 and it costs $80 to hire a housecleaner. Should they hire a housecleaner? A. Yes, if each contributes $50, then each stands to gain a consumer surplus. B. No, because each will wait for the other to hire the housecleaner. C. Yes, but only if a housecleaner will accept $50 so that each can take turns to pay the housecleaner. D. No, because it will be difficult for them to agree on which housecleaning service to use.
- a. Does the market provide an efficient amount of effort? b. The teacher of the course is considering to implement a tax-cum-subsidy policy in order to enhance effort in the course. Suppose he seeks advice from you. He proposes to subsidize effort at the rates, meaning that putting G, units of time into working on the problem sets will feel less, concretely, only like putting (1-s)G, units of time. In order to subsidize effort, he will tax students' time at the rate t, so the total available time will become(1-1)W₁. What tax-subsidy combination would you propose in order to implement the social optimum while keeping budget balance?Allison is debating about hiring Jim for a new position at her firm producing computer software. She estimates that Jim will add an additional $500 of revenue a day to her firm. Instructions: Enter your answers as a whole number. a. What is the maximum wage at which Allison would be willing to hire Jim? $ a day b. Suppose demand for computer software increases. This increases the value of Jim's contributions to the firm to $650. What is the maximum wage at which Allison would be willing to hire Jim? $ a day c. Suppose some of the firm's capital is outdated and workers no longer have the ability to be as productive. This reduces Jim's contributions to the firm to $400. What is the maximum wage at which Allison would be willing to hire Jim? $ a day d. Suppose Jim obtains additional education that leads to him being more productive. This increases the value of Jim's contributions to the firm to $750. What is the maximum wage at which Allison would be…Q^d= 9.5 - 2p Q^s= 0.6p Tax. Suppose that the government imposes a tax equal to T = 0.50 which buyers must pay for every donut they purchase. (a) How does this tax change the supply and/or demand curve for donuts? (b) Solve for the new equilibrium price and quantity of donuts. Give the price paid by the buyer and the price received by the seller. (c) Draw a single supply and demand diagram that compares the equilibrium with and without the tax. Be sure to indicate the equilibrium quantity of donuts sold as well as the price paid by buyers and the price received by sellers in each case. On the same diagram, indicate the areas which represent consumer and producer surplus, tax revenue and the deadweight loss arising from this tax. (d) Calculate the amount of producer and consumer surplus at this new equilibrium price and quantity, as well as the amount of tax revenue and the deadweight loss. (e) Is the total surplus higher, lower, or the same as in question one? Give an…
- What is the government budget constraint? How does it help us understandthe causes of high infation?Congress and the president decide that the UnitedStates should reduce air pollution by reducing its useof gasoline. They impose a $0.50 tax on each gallon ofgasoline sold.a. Should they impose this tax on producers orconsumers? Explain carefully using a supply-anddemand diagram.Suppose the federal government requires beer drinkers to pay a $2 tax on each case of beer purchased. d) Is there any inefficiency, and if so, can you define it and label it on the graph? e) If the producer has an inelastic supply curve, which market participant has the bigger tax burden? Explain.