7. In an attempt to help the local truck manufacturing industry, the Australian government imposes a tax on cach foreign truck sold in Australia. The pre-tax demand and supply schedules for imported trucks are given in the table below. Price ($) Quantity Demanded (Thousands) Quantity Supplied (Thousands) 400 350 32 000 31 000 100 200 300 30 000 300 250 200 29 000 400 28 000 500 27 000 600 150 a. In the absence of government intervention, find the equilibrium price and explain how you derived your answer. b. If the government imposes a tax of $3000 per imported truck, find the equilibrium quantity traded, the equilibrium buyer's price and the equilibrium seller's price. Explain your answers. c. Explain whether consumer surplus has decreased by $200 million, more than $200million or less than $200 million.

7. In an attempt to help the local truck manufacturing industry, the Australian government imposes a tax on cach foreign truck sold in Australia. The pre-tax demand and supply schedules for imported trucks are given in the table below. Price ($) Quantity Demanded (Thousands) Quantity Supplied (Thousands) 400 350 32 000 31 000 100 200 300 30 000 300 250 200 29 000 400 28 000 500 27 000 600 150 a. In the absence of government intervention, find the equilibrium price and explain how you derived your answer. b. If the government imposes a tax of $3000 per imported truck, find the equilibrium quantity traded, the equilibrium buyer's price and the equilibrium seller's price. Explain your answers. c. Explain whether consumer surplus has decreased by $200 million, more than $200million or less than $200 million.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Equilibrium 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 seller
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See the chart on the first picture to answer those two questions in second picture.
QUESTION 4 1.00 0.90 0.80 0.70 0.60 Supply 0.50 0.40 0.30 Démand 0.20 0.10 50 100 150 200 250 350 400 300 Suppose that a price ceiling of $0,30 is imposed on this market. Which of the following is true? Oa. the ceiling is non-binding Ob. there is a shortage of 150 Oc. there is an excess supply of 150 Od. there is a shortage of 100 units