The demand and supply schedules in the market for shoes are given in the following table. Price Demand Supply S1.00 1,000 S1.50 900 $2.00 800 $2.50 700 100 $3.00 600 200 $3.50 500 300 $4.00 400 400 S4.50 300 500 $5.00 200 600 a. Find the initial equilibrium price and quantity. b. Suppose the government imposes a new S1.00/unit tax on the producers of shoes. Find the new equilibrium price and quantity. c. Senator Jones has proposed legislation that would change the shoe tax by switching it from the seller to the buyer. If the bill passes, what will be the new equilibrium price and quantity? d. Will consumers prefer the original bill, will they prefer the Jones bill, or will they be

The demand and supply schedules in the market for shoes are given in the following table. Price Demand Supply S1.00 1,000 S1.50 900 $2.00 800 $2.50 700 100 $3.00 600 200 $3.50 500 300 $4.00 400 400 S4.50 300 500 $5.00 200 600 a. Find the initial equilibrium price and quantity. b. Suppose the government imposes a new S1.00/unit tax on the producers of shoes. Find the new equilibrium price and quantity. c. Senator Jones has proposed legislation that would change the shoe tax by switching it from the seller to the buyer. If the bill passes, what will be the new equilibrium price and quantity? d. Will consumers prefer the original bill, will they prefer the Jones bill, or will they be

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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