The demand function is given as: Q = 10-0.5P, and the supply function is given as: Q = P - 2. If a subsid of $3 is given by the government, what is the equilibrium quantity? Answer Choices: a. 6. b. 7. c. 8. d. 9.
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- The market demand and supply function for Good A are given by: Qp = 200 - 5P %3D Qs = 100 + 3P The federal government plans to levy a specific tax on each unit of Good A produced. How much tax should the federal government levy if they want to stabilize the price that sellers receive at $10? $4 $6 $2 $10 Page 9 of 55Assume quantities must be integers. The following table shows a firm's supply function assuming there is neither a tax nor a subsidy. Supply schedule P QS $104 101 $116 102 $126 103 $134 104 If the government implements a $3 per-unit subsidy, payable to the seller, what is the marginal cost of the unit number 104? Round to two decimal places and do not enter a currency symbol. If your answer is $1.125, enter 1.13.Suppose buyers of fountain drinks are required to send $0.50 to the government for every fountain drink they buy. Further, suppose this tax causes the effective price received by sellers of fountain drinks to fall by $0.25 per fountain drink. Which of the following statements is correct? a. The price paid by buyers is $0.25 per drink more than it was before the tax. b. This tax causes the supply curve for fountain drinks to shift downward by $0.50 at each quantity. c. This tax causes the demand curve for fountain drinks to shift downward by $0.50 at each quantity. d. Forty percent of the burden of the tax falls on buyers.
- Use the graph below for the next few questions; it depicts the market for apples. There are two demand curves: 1) a no- subsidy demand curve (D) and 2) a subsidy demand curve (Ds). $ price 55 50 45 40 35 30 25 20 15 10 5 0 0 10 20 20 D D. S 30 40 50 60 70 80 90 100 110 How much is the dead weight loss from the subsidy? $50 $100 $150 ○ $0The demand and supply equations for a product are: Q* = 0.2 300 – 6P and Q' = -40 + 6P. Determine the market equilibrium and draw graphs. Suppose that the government decides to impose a flat tax of 10% on each unit sold. Show that the price that consumers pay would be the same if the government imposed a tax of Rs. 1.70 per unit sold. Draw graphs and explain. Also calculate the total revenue earned by sellers before and after the tax, the tax revenue raised by the government, changes in consumer and producers surplus and dead weight loss.A market is described by the following supply and demand curves: QSQS = = 4P4P QDQD = = 400−P400−P The equilibrium price is and the equilibrium quantity is . Suppose the government imposes a price ceiling of $60. This price ceiling is , and the market price will be . The quantity supplied will be , and the quantity demanded will be . Therefore, a price ceiling of $60 will result in . Suppose the government imposes a price floor of $60. This price floor is , and the market price will be . The quantity supplied will be and the quantity demanded will be . Therefore, a price floor of $60 will result in . Instead of a price control, the government levies a tax on producers of $10. As a result, the new supply curve is: QSQS = = 4(P−10)4P−10 With this tax, the market price will be , the quantity supplied will be , and the quantity demanded will be . The passage of such tax will result in .
- The market for tomatoes is competitive and characterized by a demand function of the form QD = 60000 - 4000p and a supply function of the form Qs = 6000p -30000, where quantity is measured in kilograms and p is the price per kilogram. Suppose the government starts to charge sales tax on tomatoes. The tax is at 5% for every dollar a consumer spends on tomatoes. 1. Calculate the equilibrium prices and quantity under the value tax. 2. Calculate the government tax revenue, and the deadweight loss of the tax.Suppose that the demand curve for wheat is and the supply curve is The government provides producers with a specific subsidy of s = $2 per unit. How do the equilibrium price and quantity change? The equilibrium price by $ and the equilibrium quantity by $ Q = 400 - 40p Qs = 40p. units. (Enter numeric responses using real numbers rounded to two decimal places.)Suppose that the demand curve for wheat is and the supply curve is QD = 400 - 40p Consumer surplus Qs = 40p. The government provides producers with a specific subsidy of s = $2 per unit. How do the equilibrium price and quantity change? The equilibrium price decreases by $1 and the equilibrium quantity increases by $40 units. (Enter numeric responses using real numbers rounded to two decimal places.) Wh effe does this tax (subsidy) have on consumer surplus, producer surplus, government revenue, welfare, and deadweight lo by $.
- The demand and supply of some good are as follows: Qd = 100 - P Qs = 10 + 4P, (a) What is the equilibrium price and quantity? (b) Suppose the government imposes a tax of $5 per unit. Find: (i) the new equilibrium quantity (ii) the price a buyer will pay (iii) the price a seller will receive (iv) the deadweight loss (c) ALTERNATIVELY, suppose that the government grants a subsidy of $5 per unit. Find: (i) the new equilibrium quantity (ii) the price a buyer will pay (iii) the price a seller will receive (iv) the deadweight lossDemand for edible banjos is given by qd = 1000 -8p. Supply is given byqs = 2p. C) If the government imposes a tax of 50, what is the new equilibrium quantity?D) What is the burden of the tax on consumers?The market for widgets can be described by the following equations: Demand: P = 10 -Q 3. Supply: P = Q-4 Equilibrium price is $3 and equilibrium quantity is 7. a) Suppose that government imposes a tax of s0.5 per unit to reduce widget consumption. What will the new equilibrium and quantity be? b) What price will the buyer pay?