Show mathematically the effects on the equilibrium price and quantity of corn from a per unit of tax of t=$2 collected from suppliers, where Qd= 20-2p and Qs= 3p-20. Determine the after tax equilibrium price and quantity. Also, draw a graph to show the new price and quantity (showing also how the tax shifts the supply curve). How much will be the burden of tax on consumer and suppliers? What is the tax revenue? What is the DWL of the tax?

Show mathematically the effects on the equilibrium price and quantity of corn from a per unit of tax of t=$2 collected from suppliers, where Qd= 20-2p and Qs= 3p-20. Determine the after tax equilibrium price and quantity. Also, draw a graph to show the new price and quantity (showing also how the tax shifts the supply curve). How much will be the burden of tax on consumer and suppliers? What is the tax revenue? What is the DWL of the tax?

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter6: Supply, Demand And Government Policies

Section: Chapter Questions

Problem 3CQQ

See similar textbooks

Similar questions

1) Below is the demand and supply schedule for the market for personal chefs. These are chefs that are hired to come into the client’s home to prepare meals for them. Show all your calculations used to answer the following questions. d)calculate the excess demand or supply at the price of $35,$70,$25 and $65 e) If tax of 5$ imposed compute the consumer and producer tax burden Price per hour Qty supplied Qty demanded 20 0 29 25 1 26 30 3 23 35 5 20 40 7 17 45 9 14 50 11 11 55 13 9 60 15 7 65 17 5 70 19 3 75 21 1 80 23 0
2. The demand and supply functions of a gcod are given by P = -Qd + 125, 2P = 3Qs + 30. Determine the equilibrium price and quantity. Determine ako the effect on the market equilibrium if the govemment decides to impose a fixed tax of GHC5 on each good Who pays the tax? (p = 81, q = 44, then p = 83, q = 42) 3. If fixed costs are 18, variable costs per unit are 4, and the demand function is P = 24 - 2Q. Obtain an expression for n in terms of Q and hence sketch a graph of n against Q. a) For what values of Q does the firm break even? (q = 1 or 9) b) What is the maximum profi? (n = 32 at q = 5) 4. Given the supply and demand functions P = Q? + 12Q, + 32, P = -Qå - 4Qa + 200, Calculate the equilibrium price and quantiy. (p = 140, q = 6)
Suppose a $1 excise or commodity tax is placed on the purchasers of cans of soda. Use the graph to illustrate the impact this tax would have on the soda market and answer the questions. Be certain to shift the entire curve, endpoint to endpoint. Price per can (5) 10 9 8 7 3 2 1 0 1 deadweight loss: $ 0123456789 10 11 12 13 14 15 16 17 18 19 20 Cans of soda per day (in tens of thousands) Calculate the deadweight loss of the tax. Enter the answer in thousands. Supply Demand deadweight loss: $ 0123456789 10 11 12 13 14 15 16 17 18 19 20 Cans of soda per day (in tens of thousands) Demand Calculate the deadweight loss of the tax. Enter the answer in thousands. The tax would affect a household's Choose the answer that best describes the impact this tax would have on a household's economic income and whether it would cause a large change in the household's consumption of soda. This sort of change in behavior is called tax shifting. O uses side, but tax shifting is not likely to occur. O…
2. The demand and supply functions of shirts are given by; Demand function: P = 50 - 1.5Q Supply function: P = 22 + 2Q Using the information above; Find the equilibrium price and quantity ii. If a tax of GH¢ 10.00 per unit is imposed calculate the equilibrium price and quantity iii. The distribution of tax Analyse the introduction of price maximum of GH¢15 on shirt in the market ii. Calculate th profit made by black marketers if black market operated in this market as a result of the introduction of price maximum of GH¢ 15 in the market
If a $6 per unit tax is introduced in this market, then the price that consumers pay will equal producers receive net of the tax will equal_ 12 11 10 9 8 7 6 5 4 10 20 30 40 50 60 70 80 90 Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer a and the price that
Now calculate the government's tax revenue if it sets a tax of $0, $2, $4, 55, 56, 58, or $10 per pack. (Hint: To find the equilibrium quantity after the tax, adjust the "Quantity" field until the Tax equals the value of the per-unit tax.) Using the data you generate, plot a Laffer curve by using the green points (triangle symbol) to plot total tax revenue at each of those tax levels. Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. TAX REVENUE (Dollars) 200 180 160 140 120 100 40 20 o 3 TAX (Dolars per pack) 10 A Laffer Curve
7. In an attempt to help the local truck manufacturing industry, the Australian government imposes a tax on cach foreign truck sold in Australia. The pre-tax demand and supply schedules for imported trucks are given in the table below. Price ($) Quantity Demanded (Thousands) Quantity Supplied (Thousands) 32 000 100 400 31 000 200 300 350 30 000 300 29 000 400 250 28 000 500 200 27 000 600 150 a. In the absence of government intervention, find the equilibrium price and explain how you derived your answer. b. If the government imposes a tax of $3000 per imported truck, find the equilibrium quantity traded, the equilibrium buyer's price and the equilibrium seller's price. Explain your answers. c. Explain whether consumer surplus has decreased by $200 million, more than $200million or less than $200 million.
Price 20 18 16 14 12 10 х $1.200 0 300 400 500 $2.000 S1 SO Quantity Assume that the market in the graph above is at an initial equilibrium price of $10 and an equilibrium quantity of 500 units. If the government decides to add a $4 per-unit tax on this good, it will be able to collect the following amount of tax revenue: Demand 1000
Sellers field. You should see a tax wedge between the price buyers pay and the price sellers receive.) Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Dollars per pair) 2 2 2 2 2 2 2 2 O 50 40 35 Supply 30 25 # 15 Demand 10 5 45 0 I 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Pairs of shoes) Before Tax After Tax Buyers Sellers Graph Input Tool Market for Shoes Quantity (Pairs of shoes) Tax Burden (Dollars per pair) Elasticity Demand Price (Dollars per pair) The burden of the tax falls more heavily on the Fill in the following table with the quantity sold, the price buyers pay, and the price sellers receive before and after the tax. Quantity Price Buyers Pay (Dollars per pair) Price Sellers Receive (Dollars per pair) (Pairs of shoes) 50 25.00 10 75.00 elastic side of the…
need help with question 2 (a) Draw the demand and supply curves from the data in Table 1. (b) What is the equilibrium quantity demanded and supplied? The government now imposes a specinc tax of £3 per unit. (c) Show the effect of this on the diogram (d) Whot is the new equilibrium quantity demanded and supplied? (e) What is the new equilibrium price?' (f What is the incidence of tax per unit on i) the consumer and (i) the producer? (g) What is (1) the tax per unit and (i) total government revenue from the tox? (h) By how much will the before tox revenue or producers changer
a. The market demand and supply functions for VCR movie rentals are:QD=10-0.04P and QS=3.8P+4.Suppose that VCR movie rentals are taxed at $0.25 per unit. Calculate:i. the equilibrium quantity and price, point elasticity of demand in equilibrium andproducer surplus without tax.ii. the revenues generated by the tax, the loss in producer surplus and percentageof the burden of the tax falls on producers?b. Determine the "rule-of-thumb" price when the monopolist has a marginal cost of $25and the price elasticity of demand of -3.0.
Price ($) 34 32 30 28 26 24 28864 NO 22 20 18 16 14 12 10 864 2 1 2 3 4 5 S D 678 9 10 11 12 13 14 15 16 17 Quantity Suppose an $8 tax is imposed on sellers in the market shown in the graph. What is the tax-inclusive price paid by the buyers as a result of this tax?