The table below presents the annual market for sofas in Akron, Ohio. Suppose the state government imposes a $250 excise tax on every sofa sold to be paid by customers at the point of sale. Market for Sofas Price (dollars) $1,240 1,180 1,120 1,060 1,000 940 880 820 760 788 Quantity of Sofas Demanded 200 230 260 298 320 350 380 410 449 470 FIEALON Quantity of Sofas Supplied 300 280 260 240 220 200 180 160 140 120 Quantity of Sofas Demanded with Excise Tax 50 80 110 140 170 200 230 260 290 320 Instructions: Enter your answers as a whole number. a. Before the excise tax is imposed, what are the equilibrium price and quantity of sofas in Akron? P=$ Q= sofas b. Including the excise tax, what is the new equilibrium price consumers pay for sofas after the tax is imposed? $1 c. After the excise tax is imposed, what is the new equilibrium quantity of sofas? sofas d. What is the total amount of revenue collected by the government from the excise tax on sofas? $
The table below presents the annual market for sofas in Akron, Ohio. Suppose the state government imposes a $250 excise tax on every sofa sold to be paid by customers at the point of sale. Market for Sofas Price (dollars) $1,240 1,180 1,120 1,060 1,000 940 880 820 760 788 Quantity of Sofas Demanded 200 230 260 298 320 350 380 410 449 470 FIEALON Quantity of Sofas Supplied 300 280 260 240 220 200 180 160 140 120 Quantity of Sofas Demanded with Excise Tax 50 80 110 140 170 200 230 260 290 320 Instructions: Enter your answers as a whole number. a. Before the excise tax is imposed, what are the equilibrium price and quantity of sofas in Akron? P=$ Q= sofas b. Including the excise tax, what is the new equilibrium price consumers pay for sofas after the tax is imposed? $1 c. After the excise tax is imposed, what is the new equilibrium quantity of sofas? sofas d. What is the total amount of revenue collected by the government from the excise tax on sofas? $
Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter6: Supply, Demand And Government Policies
Section: Chapter Questions
Problem 10PA
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