The data in the table below are for kilos of prawns. Quantity Supplied (before tax) Price $19 21 23 25 27 29 31 Quantity Demanded 245 225 205 185 165 145 125 185 195 205 215 225 235 245 Quantity Supplied (after tax) a) What is the present equilibrium price and quantity? Equilibrium price: $ Equilibrium quantity: b) Complete the Quantity Supplied (after tax) that results. c) What will be the new equilibrium price and quantity? New equilibrium price: $ New equilibrium quantity: Suppose that the government introduces a $6 excise tax on prawns.

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Equilibrium Price and Quantity

Equilibrium refers to a state of balance that comes about because there is equality in all forces.