Instead, suppose the govemment taxes bus passes. The following graph shows the annual supply and demand for this good, as well as the supplycurve shifted up by the amount of the proposed tax (60 per pass).On the folowing graph, do for bus passes the same thing you did previously on the graph for concert tickets. Use the green rectangie (trangiesymbols) to shade the area that represents tax revenue for bus passes. Then, use the black triangle (plus symbols) to shade the area that representsthe deadweight ioss associated with the tax.Bus Passes Market120110SupplyS+Tax100Tax Revenue90Deadweight Loss706050203020Da1050 100 150 200 250 300 350 400 450 500 550 600QUANTITY (Passes)Complete the following table with the tax revenue collected and deadweight loss caused by each of the tax proposais.Tax RevenueDeadweight LosIf the Government Taxes...(Dollars)(Dollars)Concert tickets at $60 per ticketBus passes at $60 per passSuppose the government wants to tax the good that will generate more tax revenue at a lower welfare cost. In this case, it should tax- because, all else held constant, taxing a good with a relativelyelastic demand generates larger tax revenue andsmaller deadweight loss.PRICE (Dollars per pass) The government is considering levying a tax of $60 per unit on suppliers of either concert tickets or bus passes. The supply curve for each of thesetwo goods is identical, as you can see on each of the following graphs. The demand for concert tickets is shown by De (on the first graph), and thedemand for bus passes is shown by Dg (on the second graph).Suppose the government taxes concert tickets. The following graph shows the annual supply and demand for this good. It also shows the supply curve(S + Tax) shifted up by the amount of the proposed tax ($60 per ticket).On the following graph, use the green rectangle (triangle symbols) to shade the area that represents tax revenue for concert tickets. Then use theblack triangle (plus symbols) to shade the area that represents the deadweight loss associated with the tax.Concert Tickets Market120110 +SupplyS+Tax100Tax Revenue9080Deadweight Loss7060504030201050100 150 200 250 300 350 400 450 500 550 600QUANTITY (Tickets)PRICE (Dollars per ticket)

The equilibrium price and quantity of a good sold in the market are determined by the forces of…

Answered: The government is considering levying a…

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter6: Supply, Demand And Government Policies

Section: Chapter Questions

Problem 7PA

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The government is considering levying a tax of $60 per unit on suppliers of either concert tickets or bus passes. The supply curve for each of these two goods is identical, as you can see on each of the following graphs. The demand for concert tickets is shown by DCDC (on the first graph), and the demand for bus passes is shown by DBDB (on the second graph). Suppose the government taxes concert tickets. The following graph shows the annual supply and demand for this good. It also shows the supply curve (S+TaxS+Tax) shifted up by the amount of the proposed tax ($60 per ticket). On the following graph, use the green rectangle (triangle symbols) to shade the area that represents tax revenue for concert tickets. Then use the black triangle (plus symbols) to shade the area that represents the deadweight loss associated with the tax.
The government is considering levying a tax of $80 per unit on suppliers of either leather jackets or smartphones. The supply curve for each of these two goods is identical, as you can see on each of the following graphs. The demand for leather jackets is shown by DLDL (on the first graph), and the demand for smartphones is shown by DSDS (on the second graph). Suppose the government taxes leather jackets. The following graph shows the annual supply and demand for this good. It also shows the supply curve (S+TaxS+Tax) shifted up by the amount of the proposed tax ($80 per jacket). On the following graph, use the green rectangle (triangle symbols) to shade the area that represents tax revenue for leather jackets. Then use the black triangle (plus symbols) to shade the area that represents the deadweight loss associated with the tax. Instead, suppose the government taxes smartphones. The following graph shows the annual supply and demand for this good, as well as the supply curve…
The government is considering levying a tax of $120 per unit on suppliers of either leather jackets or smartphones. The supply curve for each of these two goods is identical, as you can see on each of the following graphs. The demand for leather jackets is shown by DLDL (on the first graph), and the demand for smartphones is shown by DSDS (on the second graph). Suppose the government taxes leather jackets. The following graph shows the annual supply and demand for this good. It also shows the supply curve (S+TaxS+Tax) shifted up by the amount of the proposed tax ($120 per jacket). On the following graph, use the green rectangle (triangle symbols) to shade the area that represents tax revenue for leather jackets. Then use the black triangle (plus symbols) to shade the area that represents the deadweight loss associated with the tax. Instead, suppose the government taxes smartphones. The following graph shows the annual supply and demand for this good, as well as the supply curve…
Q2: Suppose the demand function isp = 50 - 2q………………1and the supply function isp = 10 + 3q…………….2a) Find the market clearing price and quantity (equilibrium point)b) Sketch a graphc) Suppose the government imposes a per unit tax of $5 on producers, what would be the effect of this tax on market clearing price and quantity? ( show your answers)d) Find the consumer and producer tax burden.e) Calculate the tax revenue that the government received.
Suppose that the government has decided to place a $2 per litre tax on soft drinks. In this market, assuming that demand and supply curve have roughly the same responsiveness at their point of intersection, how is the incidence of the tax burden split between consumers and producers? Assuming next that the demand curve is less elastic. How does the tax incidence change?
Relationship between tax revenues, deadweight loss, and demand elasticity The government is considering levying a tax of $120/unit of either leather jackets or smartphones. The supply curve for each of these two goods is identical, as you can see on each of the following graphs. The demand for leather jackets is shown by DL (on the first graph), and the demand for smartphones is shown by Ds (on the second graph) suppose the government taxes leather jackets. The following graph shows the annual supply and demand for this good. It also shows the supply curve (S+tax) shifted up by the amount of the proposed tax ($120 per jacket) on the following graph, use the green rectangle (triangle symbols) to shade the area that represents tax revenue for leather jackets. Then use the black triangle (plus symbols) to shade the area that represents the deadweight loss associated with the tax.

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