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equilibrium price and quantity

equilibrium price and quantity

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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5. Consider the following is the demand and supply for basketballs in Germany. Demand 700 600 500 400 300 200 100 Supply 0 0 100 200 300 400 500 Price (€) 2.00 2.50 3.00 3.50 4.00 4.50 5.00 a. Sketch the demand and supply curves. What would be the equilibrium price and quantity? b. Suppose the government imposes a €0.5 tax per basketball on the producers. Find the new equilib- rium price and quantity. Add the new supply curve to your graph. c. Now, assume the government changes the tax by switching it from the producer to the consumer. What will be the new equilibrium price and quantity? Add the new demand curve to your graph from part (b).
Transcribed Image Text:5. Consider the following is the demand and supply for basketballs in Germany. Demand 700 600 500 400 300 200 100 Supply 0 0 100 200 300 400 500 Price (€) 2.00 2.50 3.00 3.50 4.00 4.50 5.00 a. Sketch the demand and supply curves. What would be the equilibrium price and quantity? b. Suppose the government imposes a €0.5 tax per basketball on the producers. Find the new equilib- rium price and quantity. Add the new supply curve to your graph. c. Now, assume the government changes the tax by switching it from the producer to the consumer. What will be the new equilibrium price and quantity? Add the new demand curve to your graph from part (b).
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