A3) Consider a perfectly competitive market. The industry demand curve is QD = 7-2P. The ndustry supply curve is Qs = P. Suppose the government introduces a tax t=1 on consumers. What is the equilibrium quantity in this market? a) Q*=3/2 b) Q=3 c) Q=7/3 d) Q*=7/2 e) None of the above

A3) Consider a perfectly competitive market. The industry demand curve is QD = 7-2P. The ndustry supply curve is Qs = P. Suppose the government introduces a tax t=1 on consumers. What is the equilibrium quantity in this market? a) Q=3/2 b) Q=3 c) Q=7/3 d) Q=7/2 e) None of the above

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

A3) Consider a perfectly competitive market. The industry demand curve is QD = 7-2P. The
industry supply curve is Qs = P. Suppose the government introduces a tax t=1 on consumers.
What is the equilibrium quantity in this market?
a) Q*=3/2
b) Q*=3
c) Q=7/3
d) Q*=7/2
e) None of the above

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