EBK ESSENTIALS OF ECONOMICS
8th Edition
ISBN: 8220103599832
Author: Mankiw
Publisher: Cengage Learning US
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Question
Chapter 6, Problem 7PA
Sub part (a):
To determine
The impact of tax on the gasoline to reduce air-pollution.
Sub part (b):
To determine
The impact of tax on the gasoline to reduce air-pollution.
Sub part (c):
To determine
The impact of tax on the gasoline to reduce air-pollution.
Sub part (d):
To determine
The impact of tax on the gasoline to reduce air-pollution.
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Students have asked these similar questions
Congress and the president decide that the United States should reduce air pollution by reducing its use of gasoline. They impose a $ 0.50 tax for each gallon of gasoline sold.
Should they impose this tax on producers or consumers? Explain carefully using a supply-and-demand diagram.
If the demand for gasoline were more elastic, would this tax be more effective or less effective in reducing the quantity of gasoline consumed? Explain with both words and a diagram.
Are consumers of gasoline helped or hurt by this tax? Why?
Are workers in the oil industry helped or hurt by this tax ? Why ?
41. The Government decides that it is time to reduce air pollution by reducing the usage of gasoline. They impose a 1000 VND tax on each liter of gasoline sold.
a.Should they impose this tax on producers or consumers? Explain carefully using a supply-and-demand diagram.
b.If the demand for gasoline were more elastic, would this tax be more effective or less effective in reducing the quantity of gasoline consumed? Illustrate your answers with a diagram.
The demand for salt is price inelastic and the supply of salt is price elastic. The demand for caviar is price elastic and the supply of caviar is price inelastic. Suppose that a tax of $1 per kilogram is levied on the sellers of salt and a tax of $1 per kilogram is levied on the buyers of caviar. Who would we expect to have to pay most of these taxes?
Question 29Answer
a.
the sellers of salt and the sellers of caviar
b.
the buyers of salt and the buyers of caviar
c.
the sellers of salt and the buyers of caviar
d.
the buyers of salt and the sellers of caviar
Chapter 6 Solutions
EBK ESSENTIALS OF ECONOMICS
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- Hand written solutions are strictly prohibited.arrow_forwardThe following is a Table that contains the demand and supply schedules of chocolate ice-creams. Price (cents per ice-cream) $0.90 0.80 0.70 0.60 0.50 0.40 Quantity Demanded (millions per day) 1 asifWNH 2 3 4 5 6 Quantity Supplied (millions per day) 7 6 10 10 5 4 3 2 a) If there is no tax on ice-creams, what is their price and how many are produced and consumed? b) If a tax of $0.20 cents is imposed on every ice-cream consumed, what happens to the price of an ice-cream and the number produced and consumed? Illustrate the effects of this policy on the market for chocolate ice-creams. c) How much tax does the government collect and who pays it?arrow_forwardHelp me with part by drawing graph pleasearrow_forward
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