Table 3. P Ps Qd tax Qs tax Qs $50 $70 240 $10 140 $60 $60 $70 200 $10 200 $60 $70 $70 160 $10 260 $60 $80 $70 120 $10 320 $60 20 $90 $70 80 $10 380 $60 80 $100 $70 40 $10 440 $60 140 $110 $70 $10 $60 500 200 At what price does the market reach equilibrium when the price of the substitute good equals $70 and the tax equals $60? Did the equilibrium price rise by $50, the increase in the tax? Explain how prices coordinate the behavior of buyers and sellers in markets.

Table 3. P Ps Qd tax Qs tax Qs $50 $70 240 $10 140 $60 $60 $70 200 $10 200 $60 $70 $70 160 $10 260 $60 $80 $70 120 $10 320 $60 20 $90 $70 80 $10 380 $60 80 $100 $70 40 $10 440 $60 140 $110 $70 $10 $60 500 200 At what price does the market reach equilibrium when the price of the substitute good equals $70 and the tax equals $60? Did the equilibrium price rise by $50, the increase in the tax? Explain how prices coordinate the behavior of buyers and sellers in markets.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter12: Environmental Protection And Negative Externalities

Section: Chapter Questions

Problem 11SCQ: The state of Colorado requires oil and gas companies who use fracking techniques to retune the land...

See similar textbooks

Similar questions

Please helo me with this question There are 50 residents that live in a small town in California. Each resident uses electricity and there is one power station that produces electricity for the residents from coal. Each residents' demand for electricity is Q = 10 - 2P and the supply function for the power plant is Q = 150P. For each unit of electricity that the power station produces, there is a corresponding release of pollution that leads to asthma and other health problems for the 50 residents. The marginal damage of each unit of electricity produced, per person, is $.05. a. What is the market equilibrium price and quantity per unit of electricity? b. What is the efficient Pigouvian tax per unit of pollution? c. The government of this small California town decides to impose the efficient Pigouvian per unit tax on the power station. What is the new social optimum price and quantity per unit of electricity? d. What is the government tax revenue? e. What is the gain in total…
What is Consumer Surplus at a price of $5? Price Quantity Demanded Quantity Supplied 12 1 6 10 2 5 8 3 4 6 4 3 4 5 2 2 6 1 Multiple Choice $4 $20 $16
The state of Colorado requires oil and gas companies who use fracking techniques to retune the land to its original condition after the oil and gas extractions. Table 12.9 shows the total cost and total benefits (in dollars) of this policy. Calculate the marginal cost and the marginal benefit at each quantity (acre) of land restored. See Production. Costs and Industry Structure if you need a refresher on how to calculate marginal costs and benefits. If we apply marginal analysis, what is the optimal amount of land to be restored?
Consider two ways of protecting elephants from poachers in African countries. In one approach, the government sets up enormous national parks that have sufficient habitat for elephants to thrive and forbids all local people to enter the parks or to injure either the elephants or their habitat in any way. In a second approach, the government sets up national parks and designates 10 villages around the edges of the park as official tourist centers that become places where tourists can stay and bases for guided tours inside the national park. Consider the different incentives of local villagers-who often are very poor-in each of these plans. Which plan seems more likely to help the elephant population?
A company is considering building a bridge across ariver. The bridge would cost $2 million to build andnothing to maintain. The following table shows thecompany’s anticipated demand over the lifetime ofthe bridge:Price per CrossingNumber of Crossings,in Thousands$8 07 1006 2005 3004 4003 5002 6001 7000 800a. If the company were to build the bridge, whatwould be its profit-maximizing price? Would thatlevel of output be efficient? Why or why not?b. If the company is interested in maximizing profit,should it build the bridge? What would be itsprofit or loss?c. If the government were to build the bridge, whatprice should it charge?d. Should the government build the bridge?Explain.
John is planning to travel to a country where there is some risk of contracting yellow fever. The direct market price for the medication that prevents yellow fever is $125. It would take him 2 hours to visit his doctor and get the prescription filled. The opportunity cost of his time is $25/hour. If he contracts yellow fever we assume that he will be sick and not able to work full days for two weeks. Under these conditions, let's assume he can work half days and has no vacation or sick time to use. His company will not pay him when he is sick and not working. His out of pocket expenses for medication, doctors’ visits, and lab tests to treat the yellow fever will be $500. His normal salary is $1,000 per week. John believes that his chance of getting yellow fever without preventative medicine is about 20%. His chance of getting yellow fever with the medication is 0%. There is no pain and suffering to be considered in this problem. What is the maximum price that John would pay…
14 please quickly thanks ! Under-allocation of resources occurs at the output where: A. Marginal benefit is greater than marginal cost. B. Marginal cost is greater than average total cost C. Marginal revenue equals to marginal cost. D. Social cost is below private cost.
Table 11-3This table describes the defense demands for three equal sized groups of people in Nirvanaville. The second, third, and fourth column shows the quantity that a group will demand for a given price (the first column). Price Group #1 Group #2 Group #3 $14 0 0 0 $12 0 0 3 $10 0 3 6 $ 8 3 6 13 $ 6 6 13 22 $ 4 13 22 33 $ 2 22 33 44 $ 0 33 44 58 Refer to Table 11-3. If the marginal cost of national defense is constant at $24 per unit, what is the efficient level of national defense to provide? Group of answer choices A) 3 units B) 6 units C) 13 units D) 22 units Give me correct answer with calculation otherwise i give down vote Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism. Answer completely and accurate answer. Rest assured, you will receive an upvote if the answer…
the Canadian-goverment is trying to decide between three(3) policies that affects the market of cigars.Policy One: a price support program for the Industry tobacco farmers Policy two: Label requirements and ADs marketing danger awareness warnings to the public.Policy three: a cap on no. of cases of cigars sold per-quarter at twentyfive thousand (25000)casesThe aim of the canadian government is to support farmers while reducing the consumpition of cigars.What combinations of policies should be enacted ? Indentify the right combination:(a) Policy one (b)Policy two (c)Policy three(d) Policy One and Two(e) Policy Two and Three(d) All Three PoliciesSelect Justification for the above selection(a) Reduce quanity of cigars consumed and increases price for tobacco(b)Reduce quanity of cigars consumed and increases price for cigars(C) Reduce quanity of cigars consumed and reduce price for tobacco(D)Reduce quanity of cigars consumed and reduce price for cigars
5. Assuming a $9 per unit subsidy is implemented, the welfare gain to consumers will be $______. a) 12 b) 14 c) 16 d) 19 e) 21 f) 22.5 g) 45 h 66 i) 82.5 j) 148.5 k) 171
Qd = 1,600 - 125P Qs = 440 + 165P Quantities are measured in millions of bushels; prices are measured in dollars per bushel. a. Calculate the equilibrium price and quantity that will prevail under a completely free market. b. Calculate the price elasticities of supply and demand at the equilibrium values. c. The government currently has a $4.50 bushel support price in place. What impact will this support price have on the market? Will the government be forced to purchase corn under a program that requires them to buy up any surpluses? If so, how much? 1四 "cause" causes
1 . Problems and Applications Q4 A company is considering building a bridge across a river. The bridge would cost $350,000 to build and nothing to maintain. The following table shows the company's anticipated demand over the lifetime of the bridge: Price Quantity (Dollars per crossing) (Thousands of crossings) 4.00 0 3.50 40 3.00 80 2.50 120 2.00 160 1.50 200 1.00 240 0.50 280 0 320 If the company were to build the bridge, its profit-maximizing price would be , and itwould not produce the efficient level of output. If the company is interested in maximizing profit, itshould not build the bridge because profit would be . (Note: If the company incurs a loss, be sure to enter a negative number for profit.) If the government were to build the bridge, it should charge a price of . True or False: The government should build the bridge.