8. Choose the right answer and explain. The government proposed a legal maximum price per kilogram of rice. Other things being equal, a maximum price or price ceiling is likely to cause an increase in price to cause a surplus to protect producers' revenue to cause a shortage in supply
part 8 solution needed
The UK government is considering the introduction of a unit tax on meat to alleviate the impact of meat production on the environment, as suggested by the UK Health Alliance on Climate Change. The likely effect of the introduction of the unit tax is shown in the graph below.
1. Calculate the unit tax on meat and the total tax revenue
2. Calculate the incidence of the tax on consumers and on producers (total burden on consumers and total burden on producers)
3. Calculate
4. What might have been the reasons for the UK government to have had imposed a tax on meat?
5. Surrey Sport Park, where Mohammed works as personal trainer, has experienced an increase in the number of subscriptions after the pandemic. In reward for his commitment and hard work during this period of high demand, Mohammed will receive a 10% pay rise. Mohammed goes to the movies four times per month but after the pay rise Mohamed is considering going to the movies five times per month. Calculate income elasticity (YED) of Mohamed´s demand for cinema tickets, and decide if the good is inferior, necessity or luxury for Mohammed
6. Joan has decided to raise the price of the pizzas she sells in her small family restaurant from £7.75 to £8.50 to try to balance the impact of the recent increase in the price of wheat flour. If the
7. Choose the right answer and explain. Guan has spent £2,175 on a console and video games. What is the opportunity cost of the new laptop to Guan?
- The enjoyment Guan gets from playing the new games on the console.
- The flight ticket to visit her family in Hong Kong Guan could have bought with the £2,175.
- The £2,175 Guan has spent on the console and the video games.
- All of the above are
opportunity costs for Guan.\
8. Choose the right answer and explain. The government proposed a legal maximum price per kilogram of rice. Other things being equal, a maximum price or
- to cause an increase in price
- to cause a surplus
- to protect producers' revenue
- to cause a shortage in supply
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