All questions need answering for the second question (the picture without the graph) . Old Equilibrium is on the page with graph Consumer and Producer surplusStaxP$100$70$50$45$X$5D4060Assume an excise tax that has caused a decrease in Supply as shown on the graph above Show allwork.а.How much is the tax per- unitb. How much is the value of X (intercept of the green line). How do you describe what that valueis?C.How much is the consumer surplus before the tax?d. How much is producer surplus before the tax?е.How much is the consumer surplus after the tax?f.How much is producer surplus after the tax?g.How much is the deadweight loss as a result of the tax Assume the old equilibrium before tax remains the same, but now assume the new equilibrium priceis $75 and new equilibrium quantity after tax is 30. Redo the question.a. How much is the tax per- unitb. How much is the value of X (intercept of the green line). How do you describe what that valueis?c.How much is the consumer surplus before the tax?d. How much is producer surplus before the tax?e. How much is the consumer surplus after the tax?f.How much is producer surplus after the tax?g.How much is the deadweight loss as a result of the taxh. Draw the Demand and Supply for question 2, and shade the deadweight loss area. Label all thenumbers. (old and new equilibrium and intercepts)

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Consumer and Producer surplus Stax P $100 $70 $50 $45 $X $5 40 60 Q Assume an excise tax that has caused a decrease in Supply as shown on the graph above Sho work. a. How much is the tax per- unit b. How much is the value of X (intercept of the green line). How do you describe what th is? c. How much is the consumer surplus before the tax?

Consumer and Producer surplus Stax P $100 $70 $50 $45 $X $5 40 60 Q Assume an excise tax that has caused a decrease in Supply as shown on the graph above Sho work. a. How much is the tax per- unit b. How much is the value of X (intercept of the green line). How do you describe what th is? c. How much is the consumer surplus before the tax?

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter4: Demand, Supply, And Market Equilibrium

Section: Chapter Questions

Problem 24P

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What is consumer surplus? How is it illustrated on a demand and supply diagram?
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The demand and supply equations for a product are: Q^d=300-6p and Q^x=-40+6p. . Determine the market Equilibrium and draw graphs. Suppose that the government decides to impose a flat tax of 10% on each unit sold. Show that the price that consumers pay would be the same if the government imposed a tax of Rs. 1.70 per unit sold. Draw graph and explain . Also calculate the total revenue earned by sellers before and after the tax, the tax revenue raised by the government, changes in consumer and producers surplus and dead weight loss
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Suppose the federal government requires beer drinkers to pay a $2 tax on each case of beer purchased. (a) Draw a supply-and-demand diagram of the market for beer without the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? (b) Now draw a supply-and-demand diagram for the beer market with the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? Has the quantity of beer sold increased or decreased? (c) Can you identify any government revenues? (d) Is there any inefficiency, and if so, can you define it and label it on the graph? (e) If the producer has an inelastic supply curve, which market participant has the bigger tax burden? Explain
Suppose the federal government requires beer drinkers to pay a $2 tax on each case of beer purchased. (a) Draw a supply-and-demand diagram of the market for beer without the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? (b) Now draw a supply-and-demand diagram for the beer market with the tax. Show the price paid by consumers, the price received by producers, and the quantity of beer sold. What is the difference between the price paid by consumers and the price received by producers? Has the quantity of beer sold increased or decreased?
What is consumer surplus? How is it illustrated on a demand and supply diagram? please draw
1. Assume that the demand for cigarettes is Qd=1600-30P and the supply of cigarettes is Qs=1400+70P: a. Calculate the equilibrium price and quantity and show them on a supplyand demand diagram. b. Suppose the government levies a $2 tax for each unit of cigarettes sold.Draw this on the diagram and calculate the new equilibrium price andquantity. c. Calculate the price elasticity of demand given these two price andquantity points. Is the demand for cigarettes price elastic or inelastic onthis part of the demand curve? Interpret the elasticity in words (i.e. If theprices rises by 10%, by what percentage will consumption fall?) d. On a graph, identify the tax revenue generated by this tax. e. Indicate each area on the graph with a letter and show in a table theconsumer surplus and the producer surplus before and after the tax. Also,indicate the deadweight loss associated with this tax. f. If your policy advisor boss wanted you to provide him/her witharguments in favor of this cigarette…
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