Micro Economics For Today
10th Edition
ISBN: 9781337613064
Author: Tucker, Irvin B.
Publisher: Cengage,
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Chapter 3.A, Problem 5SQ
To determine
Cause of the
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If there is a $3 tax, what is the equilibrium price buyers pay, the price sellers receive, and the quantity? If there is a $3 tax, what is the CS, PS, tax revenue, TS, and deadweight loss? Include graph!
In the market for Widgets, the equilibrium price is $ 20 and the equilibrium quantity is 5000 Widgets, which of the following statements is FALSE?
A.
None of the above
B.
If the government sets a price ceiling at $ 15 companies will increase the quantity supplied
C.
If the government sets the price floor for widgets at $ 25 there will be a surplus of widgets in the market
D.
If the price ceiling is set at $ 15 there will be a shortage of Widgets in the market
ppose the market condition for good X is characterized by an inelastic supply curve and a perfectly-elastic demand curve. Which of the following is true? It may help to draw the diagram first and then attempt the question.
A- Consumer surplus is0
B-Producer surplus is higher than consumer surplus
C-Consumer surplus is 0 Producer surplus and consumer surplus are equal
D-Not enough information given
Chapter 3 Solutions
Micro Economics For Today
Ch. 3.7 - Prob. 1YTECh. 3.7 - Prob. 1GECh. 3.7 - Prob. 2GECh. 3.7 - Prob. 3GECh. 3.A - Prob. 1SQPCh. 3.A - Prob. 2SQPCh. 3.A - Prob. 3SQPCh. 3.A - Prob. 4SQPCh. 3.A - Prob. 1SQCh. 3.A - Prob. 2SQ
Ch. 3.A - Prob. 3SQCh. 3.A - Prob. 4SQCh. 3.A - Prob. 5SQCh. 3.A - Prob. 6SQCh. 3.A - Prob. 7SQCh. 3.A - Prob. 8SQCh. 3.A - Producer surplus measures the value between the...Ch. 3.A - Prob. 10SQCh. 3.A - Prob. 11SQCh. 3.A - Prob. 12SQCh. 3.A - Prob. 13SQCh. 3.A - Prob. 14SQCh. 3.A - Prob. 15SQCh. 3.A - Prob. 16SQCh. 3.A - Prob. 17SQCh. 3.A - Prob. 18SQCh. 3.A - Prob. 19SQCh. 3.A - Prob. 20SQCh. 3 - Prob. 1SQPCh. 3 - Prob. 2SQPCh. 3 - Prob. 3SQPCh. 3 - Prob. 4SQPCh. 3 - Prob. 5SQPCh. 3 - Prob. 6SQPCh. 3 - Prob. 7SQPCh. 3 - Prob. 8SQPCh. 3 - Prob. 9SQPCh. 3 - Prob. 10SQPCh. 3 - Prob. 11SQPCh. 3 - Prob. 12SQPCh. 3 - Prob. 1SQCh. 3 - Which of the following would not cause market...Ch. 3 - Prob. 3SQCh. 3 - Prob. 4SQCh. 3 - Prob. 5SQCh. 3 - Prob. 6SQCh. 3 - Prob. 7SQCh. 3 - Prob. 8SQCh. 3 - Prob. 9SQCh. 3 - Prob. 10SQCh. 3 - Prob. 11SQCh. 3 - Prob. 12SQCh. 3 - Prob. 13SQCh. 3 - Prob. 14SQCh. 3 - Prob. 15SQCh. 3 - Prob. 16SQCh. 3 - Prob. 17SQCh. 3 - Prob. 18SQCh. 3 - Prob. 19SQCh. 3 - Prob. 20SQCh. 3 - Prob. 21SQCh. 3 - Prob. 22SQCh. 3 - Prob. 23SQCh. 3 - Prob. 24SQCh. 3 - Prob. 25SQ
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- The government imposes a price floor in the market for peanuts in order to stabilize or raise farmer's incomes. a) what is the impact on consumer surplus and producer surplus. b) what would happen to the quantity demanded and the quantity supplied of peanuts? c) would the amount of market exchange increase or decrease or remain the same. Please support answers with graph and explain.arrow_forwardThe government imposes a $2.50 per-unit tax on the consumption of good X. As a result the A) supply curve for good X shifts leftward and the price of good X rises. B) quantity demanded of good X falls and the price of good X rises. C) demand curve for good X shifts leftward and the price of good X falls. D) demand curve for good X shifts rightward and the price of good X rises. E) supply curve for good X shifts leftward and the price of good X falls.arrow_forwardThe screenshot shows a graph market for movies at equilibrium: A) Calculate Consumer, producer, and total surplus. b) Suppose in response to public outcry the government imposed a price ceiling of $8 in this market. Explain the impact on the total surplus and market efficiency.arrow_forward
- Which government policy measure would reduce the price of a product and increase the quantity traded in the market? Pick a,b,c or d a. The setting of a maximum price b. The setting of a minimum price c. The imposition of a tax d. The granting of subsidyarrow_forwardWhich of the following would restore efficiency in this market? A. A quantity limit of 10 B. A subsidy of $75 C. Auctioning 40 tradable permits D. Forbidding all trade in the marketarrow_forwardA $1 per unit tax levied on consumers of a good isequivalent toa. a $1 per unit tax levied on producers of the good.b. a $1 per unit subsidy paid to producers of the good.c. a price floor that raises the good’s price by $1 perunit.d. a price ceiling that raises the good’s price by $1per unit.arrow_forward
- Price =120-Q^2 Total cost = 30Q Find: 1- consumer surplus 2- profit 3- total social welfare 4- deadweight lossarrow_forwardthere are 4 consumers willing to pay the following amountd a-7 b-2 c-8 d-5 there are 4 haircutting firms with the following cost e-3 f-6 g-4 h-2 each firm has a capacity to produce only one haircut. for efficiency, how many haircuts should be given? which business should cut hair cut ?how large is the maximum possible total surplus? explain with diagramarrow_forwardd) deadweight loss e) total surplus after taxarrow_forward
- Suppose the demand and the supply for lumber (harvested wood processed in a sawmill) used for construction in Australia are given byQD =100 – 2PQS = 1/2PAssume also that the market is perfectly competitive. the government introduces a subsidy of s=5 per unit of lumber transacted in the market. Calculate the deadweight loss caused by the subsidy and illustrate it in a graph. Who benefits more from the subsidy, consumers or producers? Why?arrow_forwardEquilibrium price or market clearing price is theprice whereSelect one:a. Demand and supply curves interactO b. Price ceiling is imposed0 C. Government fixes the pricesO d. Buyer forced sellerarrow_forwarda. 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?arrow_forward
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