The demand function D(p) = 200 - 4p and supply function is S(p)= 6p Find the equilibrium price and quantity If government collect $10 unit tax from each product, find the equilibrium demand and supply prices. How much tax revenue is collected? What is the deadweight loss amount as a result of taxation?
The demand function D(p) = 200 - 4p and supply function is S(p)= 6p Find the equilibrium price and quantity If government collect $10 unit tax from each product, find the equilibrium demand and supply prices. How much tax revenue is collected? What is the deadweight loss amount as a result of taxation?
Microeconomics: Principles & Policy
14th Edition
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:William J. Baumol, Alan S. Blinder, John L. Solow
Chapter17: Taxation And Resource Allocation
Section: Chapter Questions
Problem 4TY
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Question
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The demand function D(p) = 200 - 4p and supply function is S(p)= 6p
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Find the
equilibrium price and quantity -
If government collect $10 unit tax from each product, find the equilibrium demand and supply prices.
-
How much tax revenue is collected?
-
What is the
deadweight loss amount as a result oftaxation ?
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