Demand: Q° =1080-7P Supply: Q =-120 +3P opose now that government imposes $60 tax per unit of output on sellers. What is the burden on sell- %3D 42 30 O 60 18
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- S1 10 SO 8. Demand 0 10 20 30 40 50 60 70 80 90 100 Q Suppose that the market is initially at an equilibrium price of $6 and an equilibrium quantity of 40 units in the graph above. If the government decides to add a $2 per-únit tax on this good, the deadweight loss from the tax will be: 80 70 60 O 10 46676 5432 106 of 11 Example 5. Maximizing Tax Revenue. Suppose the demand and supply functions for a product are p = 2800-8q-q/3 and p = 400+2q respectively, where p is in dollars and q is the number of units. Find the tax t that will maximize the tax revenue T, and find the maximum tax revenue.Suppose a $1 excise or commodity tax is placed on the purchasers of cans of soda. Use the graph to illustrate the impact this tax would have on the soda market and answer the questions. Be certain to shift the entire curve, endpoint to endpoint. Price per can (5) 10 9 8 7 3 2 1 0 1 deadweight loss: $ 0123456789 10 11 12 13 14 15 16 17 18 19 20 Cans of soda per day (in tens of thousands) Calculate the deadweight loss of the tax. Enter the answer in thousands. Supply Demand deadweight loss: $ 0123456789 10 11 12 13 14 15 16 17 18 19 20 Cans of soda per day (in tens of thousands) Demand Calculate the deadweight loss of the tax. Enter the answer in thousands. The tax would affect a household's Choose the answer that best describes the impact this tax would have on a household's economic income and whether it would cause a large change in the household's consumption of soda. This sort of change in behavior is called tax shifting. O uses side, but tax shifting is not likely to occur. O…
- To raise funds aimed at providing more support for public schools, a state government has just imposed a unit excise tax equal to $4 for each monthly unit of cell services sold by each company operating in the state. The following diagram depicts the positions of the demand and supply curves for cell services before the unit excise tax was imposed. Use this diagram to determine the position of the new market supply curve now that the tax hike has gone into effect. a. Does imposing the $4-per-month unit excise tax cause the market price of cell services to rise by $4 per month? Why or why not? b. What portion of the $4-per-month unit excise tax is paid by consumers? What portion is paid by providers of cell services?Suppose that a lumber-producing firm had a demand for the ability to burn sawdust given by: Q = 90- P. Where Q is amount of sawdust burned when the firm has to pay price (P) per unit of sawdust burned. Calculate the quantity of sawdust burned if there is a per unit tax of $26 per unit of sawdust burned. (Do not include a $ sign in your response. Round to the nearest 2 decimal places if necessary.) Answer: CheckPrice S1 20 18 16 14 12 10 SO Demand 300 400 500 1000 Quantity Suppose that the market in the graph above is at an initial equilibrium price of $10 and an equilibrium quantity of 500 units. If the government decides to add a $4 per-unit tax on this good, the equilibrium price will change to: $12 $8 $14 $4 2086 420
- Assume the state of Alaska placed a tax on playing cards of 7 cents per pack. If the state generated $42630 in revenue, how many packs of cards were sold?Suppose the government imposes a $2 tax on this market 10 X 12345678910 QUANTITY Refer to Figure 6 14 Suppose D,represents the demand curve for gasoline in both the short run and long run, S,represents the supply curve for gasoline in the short run, and Sprepresents the supply curve for gasoline in the long run. After the imposition of the $2 ux, the price paid by buyers will be Select one: O a. unable to be determined without additional information Ob higher in the long run than in the short run OC. higher in the short run than in the long rus Od. equivalent in the short run and the long run.The inverse demand function is p = 10q, where q is the number of units sold. The inverse supply function is defined by p = 2 + q. A tax of $2 is imposed on suppliers for each unit that they sell. After the tax is imposed, the equilibrium quantity with taxes is. 0 1 07 O 3 04 09
- Doyle and Samphantharak (2008) find that when a 5% gas tax is implemented, prices consumers pay for gas increase by about 4%. What role does demand elasticity play in determining the size of this price change? That is, under what demand elasticity cases would the price change be closer to 5%, or closer to 0%? Illustrate and explain using supply-and-demand graph(s)..Suppose the government imposes a $10 per unit tax on a good (see diagram below) causing buyers to pay $18 for the item compared with an original equilibrium price of $12. What is the tax revenue the government collects from the sale of this item? Price 24 22 20 18 Supply 16- 14- 12 10 H 6+ 4 K M Demand 2+ 3 6 9 12 15 18 21 24 27 30 33 36 39 Quantity $100 $80 $120 $60 MacBook Air 吕口 F9 F10 F3 F4 F5 F6 F7 F8 % & 4 7 8 9.6. Consider the (inverse) demand function P=a-bQ And the (inverse) supply function P=cQ What is the equilibrium price and quantity in the market? а. b. What is the equilibrium price and quantity if the suppliers have to pay a tax t per unit sold? What is the equilibrium if the buyers have to pay a tax of t unit sold? с. per