First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade thearea representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producersurplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss.PRICE (Dollars per scooter)300270240210180 Tax Wedge1501209060DemandCA0 2040Consumer SurplusProducer SurplusTax RevenueSupplyDeadweight LossAfter Tax6080 100 120 140 160 180 200QUANTITY (Scooters)Before Tax(Dollars)Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumersurplus, producer surplus, tax revenue, and deadweight loss after the tax.Note: You can determine the areas of different portions of the graph by selecting the relevant area.00Tax RevenueAfter Tax(Dollars)Consumer SurplusProducer SurplusDeadweight Loss(?

The producer surplus is the amount that separates what a seller can obtain by selling an item at…

First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade the area representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producer surplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss. PRICE (Dollars per scooter) 300 270 240 210 180 Tax Wedge 150 120 90 60 30 Demand 0 0 20 40 Supply Consumer Surplus Producer Surplus Tax Revenue Deadweight Loss 60 After Tax 80 100 120 140 160 180 200 QUANTITY (Scooters) Before Tax (Dollars) 0 0 Tax Revenue Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumer surplus, producer surplus, tax revenue, and deadweight loss after the tax. Note: You can determine the areas of different portions of the graph by selecting the relevant area. After Tax (Dollars) Consumer Surplus Producer Surplus Deadweight Loss

First, use the tan quadrilateral (dash symbols) to shade the area representing tax revenue. Next, use the green point (triangle symbol) to shade the area representing total consumer surplus after the tax. Then, use the purple point (diamond symbol) to shade the area representing total producer surplus after the tax. Finally, use the black point (plus symbol) to shade the area representing deadweight loss. PRICE (Dollars per scooter) 300 270 240 210 180 Tax Wedge 150 120 90 60 30 Demand 0 0 20 40 Supply Consumer Surplus Producer Surplus Tax Revenue Deadweight Loss 60 After Tax 80 100 120 140 160 180 200 QUANTITY (Scooters) Before Tax (Dollars) 0 0 Tax Revenue Complete the following table by using the previous graphs to determine the values of consumer and producer surplus before the tax, and consumer surplus, producer surplus, tax revenue, and deadweight loss after the tax. Note: You can determine the areas of different portions of the graph by selecting the relevant area. After Tax (Dollars) Consumer Surplus Producer Surplus Deadweight Loss

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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V surplus is the difference between the highest price a consumer is willing to and the price the consumer actually pays. This component of economic surplus is illustrated in the diagram to the right by area Do Quantity (per time period)
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The demand (D) and supply (S) function for a commodity are P=100 - 20 and P = 10 + Q, respectively. (a) Find the equilibrium price and quantity. That is, find the price and quantity where the D and S functions intersect. (b) A new 10% tax is imposed on this commodity. Find the burden of the tax on demanders and the burden on suppliers. Also find the total taxes. [In order to insure that we all do this problem in the same way, let's assume that the tax is imposed on the supply side of the market. In addition, the burden of the tax on demanders is the difference in price demanders pay when the tax is in existence less the price they paid when there was no tax. The burden on suppliers is the difference in price suppliers received when there was no tax and the net price (after remitting tax to the government) they receive when the tax is in existence.]
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