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A: The correct Option is (A) That is the supply is more elastic than the demand
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A: Answer-
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A: The fraction of tax borne by the demanded = ES/(ED+ES) Similarly, for supplier = ED/(ED+ES) A) ED =…
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A: The market for junk food is represented in the below steps.
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A: If we simply consider smoking, it is hard as the demand for cigarette is always inelastic.
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A: Elasticity of supply curve depicts how much producer responds with the change in the price level.
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A: Disclaimer :- since you have asked multipart questions we can solve only 3 subparts as per…
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A: Since you posted multiple questions, we will provide the answer for first three questions.
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A: Elasticity of demand depicts how much consumer responds with the change in price.
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A: Given P1 = K200000 Tax rate = 15% P2 = 15% of K200000 + K200000 = K30000+K200000 = K230000 D1 = 1000…
Q: D1 Price K N D2 D3 Qty P.
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A: Price elasticity of supply depicts how much producer responds with the change in the price level.
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Assuming the demand and supply curve are elastic, discuss the incidence of a tax imposed on the supplier
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- How does a sugar tax that increases the final price of non-alcoholic beverages with sugar address the problem? Using the concept of price elasticity of demand, is a tax on non-alcoholic beverages with sugar the best way of addressing the problem?The supply of book is perfectly elastic at a price of 200. The demand curve of consumer is given by the function Q=30000000-125000P, suppose that a 80 percent subsidy is imposed on the producer of book. calculate the excess burden resulting from the taxSuppose the market for cigarette is competitive. An economist estimates the price elasticity of demand and supply for cigarette are -0.8 and 0.7 respectively. Suppose the government imposes a per-unit tax of $45 on the cigarette sellers. By how much would buyers share the tax burden respectively? Show your calculation.
- the government has imposed an indirect tax on good A and the coefficient of the price elasticity of demand is <1. Explain and demonstrate with the use of appropriate diagrams the effect of this tax on both the buyer and seller. indicate in your diagram by shading the regions in different colours the price paid by consumer and price paid by supplier.If a tax of $1.20 is imposed on consumers in this market, what is the tax revenue?A local government is seeking to impose a specific tax on hotel rooms. The price elasticity of supply of hotel rooms is 3.5, and the price elasticity of demand is 0.3. If the new tax is imposed, who will bear the greater burden-hotel suppliers or hotel consumers? The hotel consumers pay percent and hotel suppliers pay percent of the tax. (Enter your responses rounded one decimal place.)
- Suppose the price elasticity of demand for smartphones is 0.5 (absolute value), while the price elasticity of supply is 1.9. If the government imposes a per-unit tax of $100 on the sellers of smartphones, how will the price and quantity transacted of smartphones change? Will the sellers or the buyers bear a larger tax burden? Will the market be able to achieve economic efficiency after the tax is imposed? Explain with a diagram.Suppose an economist estimates that the price elasticity of supply for red wine is2.4 while its price elasticity of demand is -4.0.If the government decides to impost a per-unit sales tax of $40 per bottle of redwine, how would the market price for red wine be affected? Show yourcalculation.If you estimate a price elasticity of demand equal to 1.25 (negative sign is implied), do consumers orproducers shoulder more of a tax on the relevant good? Explain briefly.
- The price elasticity of demand is -3, the price elasticity of supply is 1. The government imposes a per-unit tax of 80 Cents on the sale of a cup of coffee in paper cups. Compute how much of the 80 Cents per cup is actually borne by the consumer and how much is borne by the seller.The article described shortcomings of using CAFE standards to improve fuel economy and emissions of carbon from automobiles: “Taxing carbon emissions or gasoline directly, as Europe does, would be far more cost-efficient.” The federal gasoline tax is 18.4 cents per gallon. The impact of an increase in the gasoline tax depends on the reaction of consumers to the tax. A research study found that the price elasticity of demand for gasoline is -0.06. Holding everything else constant, assume that an increase in the federal tax on gasoline results in a 5 percent increase in the price of a gallon of gasoline. If the price elasticity of demand for gasoline is -0.06, how much will the quantity demanded for gasoline change? Explain how you derived your answer.Suppose an economist estimates the price elasticity of demand for instant noodle is -2.4, while its price elasticity of supply is 4.0. If the government decides to impost a per-unit sales tax of $16 per pack of instant noodle, how would the market price for instant noodle be affected? Show your calculation.