Assume also that the estimated supply function for beans is given as: Q; = 19+ 20P, – 10W + 6T – 32P, – 20PE + 5F where O is the quantity of beans supplied each month, Ps is the price of beans, W is the price of abor, Tis an index measuring the level of technology, P, is the price of groundnut which is rekted in production, Pe is the expected future price beans, and F is the number of firms in the industry. If W = 8, T=4, P;=4,P.=5 and F = 47, 4 |Page h. Sketch the demand and supply curves and examine the welfare of the economic agents and hence find the total welfare of the society. i Assuming the government imposes a per unit tax of GH¢5.00 on every bag of beans sokd, determine the new equilibrium price and quantity. Explain the effect of the policy on the market. į Estimate the deadweight loss from the per unit tax.

Assume also that the estimated supply function for beans is given as: Q; = 19+ 20P, – 10W + 6T – 32P, – 20PE + 5F where O is the quantity of beans supplied each month, Ps is the price of beans, W is the price of abor, Tis an index measuring the level of technology, P, is the price of groundnut which is rekted in production, Pe is the expected future price beans, and F is the number of firms in the industry. If W = 8, T=4, P;=4,P.=5 and F = 47, 4 |Page h. Sketch the demand and supply curves and examine the welfare of the economic agents and hence find the total welfare of the society. i Assuming the government imposes a per unit tax of GH¢5.00 on every bag of beans sokd, determine the new equilibrium price and quantity. Explain the effect of the policy on the market. į Estimate the deadweight loss from the per unit tax.

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

The quantity demanded equation of beans

Qd=2499-4P_b

Assume also that the estimated supply function for beans is given as:
Q; = 19+ 20P, – 10W + 6T – 32P, – 20PE + 5F where O is the
quantity of beans supplied each month, Ps is the price of beans, W is the price of abor, Tis an index
measuring the level of technology, P, is the price of groundnut which is rekted in production, Pe
is the expected future price beans, and F is the number of firms in the
industry. If W = 8, T=4, P;=4,P.=5 and F = 47,
4 |Page
h. Sketch the demand and supply curves and examine the welfare of the economic agents and hence
find the total welfare of the society.
i Assuming the government imposes a per unit tax of GH¢5.00 on every bag of beans sokd,
determine the new equilibrium price and quantity. Explain the effect of the policy on the
market.
į Estimate the deadweight loss from the per unit tax.

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