EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 20, Problem 3RQ
To determine
Reducing the surplus corn.
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Students have asked these similar questions
10:17
OT
1. A college student enjoys eating pizza. Her
willingness to pay for each slice is shown in the
following table:
Number of pizza
slices
7
1
2
3
4
5
6
7
Willingness to pay (per
slice)
$6
+
LO
5
4
3
2
1
b. If the price of slices falls to $2, how much
consumer surplus will she enjoy?
O
3
Suppose the demand for a product is given by P = 30-3Q. Also, the supply is given by P = 10 + Q.
If a $4 per-unit excise tax is levied on the buyers of a good, the deadweight loss created by this tax
will be
$4
$16
None of these
$24
O $8
Question 5
Suppose the demand for a product is given by P = 30 - 2Q. Also, the supply is given by P = 5 + 3Q.
If a $5 per-unit excise tax is levied on the buyers of a good, after the tax, consumer surplus is equal
to
O None of these
$16
$25
$24
1 pts
$2.50
A tax is imposed like in the figure below. This will REDUCE the producer surplus by
12
6
5
2
O24
08
18
I
OI choose to use one of my three skips on this question.
O 10
8 12
S+$2 tax
S
units.
Chapter 20 Solutions
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- 3.30 3.00 2.70 2.40 2.10 1.80 1.50 1.20 0.90 0.60 0.30 50 100 150 200 250 300 350 400 O b. There will be a excess supply of 200 units O c. The ceiling is non-binding O d. There will be an excess supply of 100 units Supply Demand Suppose that a price ceiling is set at $2.70. Which of the following is true? O a. There will be a shortage of 200 units Click Save and Submit to save and submit. Click Save All Answers to save all aarrow_forwardFigure: Commodity Tax Price $2.25 1.75 1.50 0 100 200 325 400 D₂ D₁ Quantity If a $0.75 tax is imposed on sellers of candy bars, the new equilibrium is: O 325 candy bars at $2.25 each. 325 candy bars at $1.50 each. 325 candy bars at $1.75 each. 400 candy bars at $2.25 each.arrow_forwardPlease examine the market for AC units below. In this market, the Home nation has imposed a quota limiting the number of AC units that foreign nations are allowed to export into the Home economy. Based on this diagram, what was the level of that quota? Price $12 $11 $10 59 50 $7 56 55 $4 53 52 51 0 Home Market for AC Units 123 O 3 units Quantity IS 5+Q XX 4 or more units Pw O 1 unit O2 units Consumer Surplus Producer Surplus Consumer Surplus Producer Surplus Price $12 $11 $10 $9 S8 $7 $6 $5 $4 $3 $2 $1 0 International Market for AC Units 1 C Se 2 3 4 5 6 7 8 9 10 Quantityarrow_forward
- 20 18 S 16 14 12 10 8 D 4 2 0 + 0 1 2 3 4 5 6 7 8 9 10 11 12 Quantity Suppose that supply and demand at a market are represented by curves S and D at the figure above (notice that the vertical axis grid has increments of $2) and then a tax of $6 dollars per unit is imposed on buyers. What is the tax burden on the sellers? $8 $6 $4 $2 Pricearrow_forwardImagine that the demand curve for beer is given by P=9-Q and supply for beer is given by P=1+Q. What is the deadweight loss associated with a tax of $3 per unit? 12 O 2.25 O None of the above. O 6.25arrow_forwardPRICE 20 18 16 14 12 10 Demand 1 6 4 25 units. O27 units. Consumer 1 9 units. 2 units. 2460 10 12 14 16 18 20 QUANTITY PRICE 27 24 21 718 15 12 9 6 Refer to Figure 4-2. If these are the only two consumers in the market, then the market quantity demanded at a price of $3 is Consumer 2 Demand 5 10 15 20 25 30 35 40 45 50 QUANTITYarrow_forward
- Suppose that the demand and supply functions for a good are given as follows: Demand: 0 = 600-5P Supply: 0 Suppose now that government imposes $27 tax per unit of output on sellers. What is the burden on sellers? =-300+4P O 27 12 15arrow_forwardQuestion 5: Combined state and federal taxes on gasoline average around 50 cents per gallon, and these taxes are statutorily levied on gasoline sellers. Because the demand for gasoline is relatively inelastic compared to the supply of gasoline: buyers likely do not bear much of the actual burden because it is statutorily levied on sellers who must submit the tax payments. sellers likely bear most of the actual burden of the tax through lower gasoline prices. O the net price received by sellers after they pay taxes likely falls by almost the full amount of the tax. O buyers likely bear most of the actual burden of the tax through higher gasoline prices.arrow_forwardFigure 9-24 The following diagram shows the domestic demand and supply in a market. Assume that the world price in this market is $20 per unit. 90 80 70- 60- 50 40 30 20 10 Price 5 10 15 20 25 30 Supply Demand + 35 40 Quantity Refer to Figure 9-24. Suppose the government imposes a tariff of $10 per unit. With trade and a tariff, total surplus is O a. $750. O b. $900. O c. $950. O d. $1,550.arrow_forward
- What is the deadweight loss resulting in a $10 price ceiling on this market? 50 Supply 45 40 35 30 20 15 10 Demand O 10 20 30 40 50 60 70 80 90 100 Quantity of Cement (Bags) | 20 bags of cement O $150 O 40 bags of cement $0 ) There will be no deadweight loss since consumers are getting cheaper products O none of these answers are accurate $250 O $100 Price per bag ($)arrow_forwardChapter 10: In the small open economy of Gatorland, the domestic demand for widgets is given by P=100-3Q; the home supply of widget is given by P = Q. The world price is $40. Now let the government of Gatorland give a $15 per unit subsidy on each widget exported. What is the value of total subsidy payments to Gatorland's widget exporters? O $825 O $600 O $125 O $225arrow_forwardQuestion 29 500 $3.76 $3.40 $3.30 $3 00 10 12 14 16 18 20 Suppose that a tax of $0.45 is imposed on this market, what will be the new price suppliers receive? O a. 3.75 O b.3.00 OC. 3.30 O d.3.40arrow_forward
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