Answered: 12 11 10 9 8 7 6 5 3+ 2+ 1 Supply…

12 11 10 9 8 7 6 5 3+ 2+ 1 Supply Demand 05 1 15 2 25 3 35 4 45 5 Quantity 5. Refer to Figure 8-2. The imposition of the tax caus a. increase by 1 unit. b. decrease by 1 unit. increase by 2 units.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

12
11+
10
9
166
8
7+
6
5-
st
4
3+
2-
1
Price
A
Supply
Demand
05 1 15 2 25 3 35 4 45 5 Quantity
26. Refer to Figure 8-2. The imposition of the tax causes the quantity sold to
a. increase by 1 unit.
b. decrease by 1 unit.
c. increase by 2 units.
d. decrease by 2 units.
27. Refer to Figure 8-2. The imposition of the tax causes the price received by sellers to
a. decrease by $2.
b. increase by $3.
c. decrease by $4.
d. increase by $5.
28. Refer to Figure 8-2. The per-unit burden of the tax on buyers is
a. $2.
b. $3.
c. $4.
d. $5.
29. Refer to Figure 8-2. The loss of consumer surplus as a result of the tax is
a. $1.50.
b. $3.
c. $4.50.
d. $6.

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45)
39. Suppose that the demand for picture frames is highly inelastic, and the supply of picture frames is highly elastic. A tax of $1 per frame levied on picture frames will increase the price paid by buyers of picture frames by a. b. C. d. less than $0.50. $0.50. between $0.50 and $1. $1.
Figure 4-15 Price (dollars per case) $32 27 22 20 0 Tax- 50 O $7. O $20. O $22. O $27. 90 Supply with tax Supply Quantity (thousands of cases) Figure 4-15 shows the market for beer. The government plans to impose a per-unit tax in this market. Refer to Figure 4-15. The price buyers pay after the tax is
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Figure 8-3 The vertical distance between points A and C represents a tax in the market. P4 P3 P2 Pl Price Q1 B b. ABC. c. P3ACP1. d. P2DAP3. Q2 Supply Demand Quantity Refer to Figure 8-3. The amount of tax revenue received by the government is equal to the area a. P1CDP2.
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QUESTION 3 What tax per item t will maximize total tax reveue T = tq if the demand is p+q3D1000 and supply 92 +2.5q+920 30 is
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The vertical distance between points A and B represents the original tax. 12+ 11+ 10 9 8 7. 6 Price 2 1 D 05 1 15 2 25 3 35 4 45 5 Quantity Refer to Figure 8-19. If the government changed the per-unit tax from $5.00 to $7.50, then the price paid by buyers would be $10.50, the price received by sellers would be $3, and the quantity sold in the market would be 0.5 units. Deadweight loss would now be a. $1.50 O b. $0.50 c. $4.0 Od. $0.625
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Suppose in the market for cigarettes, the price elasticity of supply is 2.4 and the price elasticity of demand is −0.8. If an excise tax is imposed on sellers of cigarettes, then _____. a buyers and sellers will pay equal shares of the tax b buyers will pay a greater share of the tax than sellers will c buyers will pay the whole tax d sellers will pay a greater share of the tax than buyers will e sellers will pay the whole tax