P $3.00 $2.66 $2.00 10/1 So 130 150 bb bb Figure two: effect of excise tax on supply and demand Q QUESTION #19: a) a. b. C. a. b. C. Before the Tax: Price the Consumer Pays = Price the Producer Receives = Quantity = After the Tax, Price the Consumer Pays = Price the Producer Receives = Tax per unit =

P $3.00 $2.66 $2.00 10/1 So 130 150 bb bb Figure two: effect of excise tax on supply and demand Q QUESTION #19: a) a. b. C. a. b. C. Before the Tax: Price the Consumer Pays = Price the Producer Receives = Quantity = After the Tax, Price the Consumer Pays = Price the Producer Receives = Tax per unit =

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 33 Do buyers or sellers bear more of the burden of this tax? Group of answer choices Buyers bear more of the tax burden. Seller's bear more of the tax burden. Buyers and sellers bear the burden equally.
1. Consider the market for candy bars given below. Suppose that the government imposes a tax of $2 per candy bar in this market. Show on the graph and calculate the following: Price 5 $4.50 $4 $3.50 Supply 53 $2.50 $2 $1.50 $1 Demand S0.50 400 800 1200 1600 2000 2400 2800 3200 3600 4000 Candy Bars A. The quantity the market will produce with the tax. B. The government revenue from the tax. C. The deadweight loss from the tax. D. The consumer surplus with the tax. E. The producer surplus with the tax.
Consumer and Producer surplus Stax P $100 $70 $50 $45 $X $5 D 40 60 Assume an excise tax that has caused a decrease in Supply as shown on the graph above Show all work. а. 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 that value is? 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
Question 11 Explain how do the tax incidence and deadweight loss of a commodity tax vary with the elasticities of demand and supply (you do NOT have to refer to the specific demand and supply in the exercise above. You have to discuss, in general, how the elasticities of demand and supply affects the tax incidence and deadweight loss. A BI EEP E
What is the buyers’ share of the burden of the tax _______?
Text Box 7rice 16 Suppose the government imposed a per unit tax of S6 on buyers. 14 12 Work out the following. 10 Answer Equilibrium Quantity after tax Price paid by buyers after tax (P») Price received by sellers after tax (P,) Tax Revenue collected by government The burden of tax on buyers 20 10 4 120 2. The burden of tax on Sellers 4 10 20 30 40 50 60 70 80
9) The following graph shows the effect of a per-ticket tax on plane tickets from Boston to Tampa. Use the graph to answer questions 5 to 10. $30 $20 $10 Price (P) of airline tickets (in dollars per ticket) How much of the per-ticket tax is paid by passengers? $40 230 200 190 2850 3000 Swith tax Sno tax D Figure 14 Image author created Quantity (Q) of airline tickets (thousands per day)
6) The following graph shows the effect of a per-ticket tax on plane tickets from Boston to Tampa. Use the graph to answer questions 5 to 10. O $10 $30 $40 Price (P) of airline tickets (in dollars per ticket) What is the amount of the tax per ticket from Boston to Tampa? $20 230 200 190 2850 3000 with tax D Sno tax Figure 14 Image author created Quantity (Q) of airline tickets (thousands per day)
The vertical distance between points A and B represents a tax in the market. 12 11 10 210 A Supply 9 PRICE 65 4 3 B 10 2 1 MNr Demand + 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5 6.0 QUANTITY Refer to Figure. The imposition of the tax causes the price paid by buyers to O decrease by $2. O increase by $3. O decrease by $4, O increase by $5.
Question 4 Figure #3: The graph below represents a $10 per unit tax on a good then the amount bought and sold in the market is only 4 units. Note that Q represents quantity and P represents price. P. 24 20 A 16 Supply 12 GIH 8. 4. K M Demand 4 6 10 12 14 16 Refer to Figure #3. The government collects tax revenue that is (or are) the area(s) represented by the area OF-G-L OL OB-D Oc-F
QUESTION 10 Refer to the figure below: Tprice 10 6. 6. 4. D ater tade 10 20 30 40 50 60 70 80 quantity From the figure above, calculate the following: 1. The new price that the buyers will pay after the taxes. 2. The new price that the sellers will receive after the taxes 3. The tax burden on the buyers. 4. The tax burden on the sellers. 5. Tax size per unit. Note: Make sure to show details wherever necessary and possible. T T TT Paragraph 3 (12pt) E T - Arial T T HTML CSS O f Mashups 囲国旺 , 田! II
Figure 8-1 P' P" P tPrice J K L Zi I+Y. M K+L. N ****** ...... B Refer to Figure 8-1. Suppose the government imposes a tax of P - P". The tax revenue is measured by the area J+K+L+M. Supply I+J+K+L+M+Y. Demand Quantity