Question 16 Suppose the market demand for a good takes the form: Q=100-2P X and market supply takes the form: Q=-50+3P Suppose a $5 per unit tax is applied to sellers in the market. What is producer surplus after the tax? Selected Answer: 1875 Question 17 Suppose the market demand for a good takes the form: =100-2P and market supply takes the form: Q=-50+3P Suppose a $5 per unit tax is applied to sellers in the market. What is total surplus after the tax? Selected Answer: 2750 Question 18 Suppose the market demand for a good takes the form: Q=100-2P and market supply takes the form: Q=-50+3P Suppose a $5 per unit tax is applied to sellers in the market. What is the deadweight loss from the tax? (Hint: calculate directly, using too many rounded values may lead to an inaccurate answer) Selected Answer: 37.5

Question 16 Suppose the market demand for a good takes the form: Q=100-2P X and market supply takes the form: Q=-50+3P Suppose a $5 per unit tax is applied to sellers in the market. What is producer surplus after the tax? Selected Answer: 1875 Question 17 Suppose the market demand for a good takes the form: =100-2P and market supply takes the form: Q=-50+3P Suppose a $5 per unit tax is applied to sellers in the market. What is total surplus after the tax? Selected Answer: 2750 Question 18 Suppose the market demand for a good takes the form: Q=100-2P and market supply takes the form: Q=-50+3P Suppose a $5 per unit tax is applied to sellers in the market. What is the deadweight loss from the tax? (Hint: calculate directly, using too many rounded values may lead to an inaccurate answer) Selected Answer: 37.5

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1) Describe in detail how taxes impact consumer and producer surplus. In your discussion, also show graphically, the before and after-tax impact.
Only typed answer
Answer is 10,786.8
Suppose an additional "special" tax of $0.10 per litre is imposed on the sale of gasoline in one province. Prior to the tax the price was $1.30 per litre and 10 million litres of gasoline are sold per day. After imposition of the tax, the new equilibrium price and quantity are $1.38 per litre and 9.6 million litres per day. What is the direct burden of this "special" tax?
(ALL OWNERSHIP GOES TO CENGAGE) The following graph represents the demand and supply for blinkies (an imaginary product). The black point (plus symbol) indicates the pre-tax equilibrium. Suppose the government has just decided to impose a tax on this market; the grey points (star symbol) indicate the after-tax scenario. (images below)
Consider the demand curve as in tutorial 12 (question 1), qd = 240 - 3p, where q is the quantity demanded and p is the price. The supply curve is given by qs = p - 6. If a specific (or per-unit) tax of $20 is imposed on sellers, how much tax revenue does the government raise in this market? [Round to one decimal place in both your calculations and in your final answer; Note: both the supply curve and the tax are different from the tutorial question.]
P P=7 On the following diagram if there is a tax of $3 dollars imposed on sellers, what is the tax burden on sellers? $1 O $2 $3 $7
a)Show in four diagrams the incidence of an indirect (specific) tax in the case of elastic and inelastic demand and elastic and inelastic supply. b)Consider supply in the long run. Assume that a specific tax is imposed on a good that was previously untaxed. How will the incidence of this tax change as time passes?