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Suppose that the demand equation: P = 6 – Q and supply equation: P = Q....

Suppose that the demand equation: P = 6 – Q and supply equation: P = Q.

a. Calculate the price elasticity of demand at equilibrium.
b. Calculate the equilibrium price and quantity, and consumer surplus and producer surplus.
c. Suppose government imposes a unit tax of $1 on producers. Derive the new supply curve and also calculate the new equilibrium price and quantity.
d. Calculate tax revenue and the deadweight loss of this tax.

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