Question

The government has levied a per unit tax of $72.00 on the suppliers of a good....

The government has levied a per unit tax of $72.00 on the suppliers of a good. The supply function of the good when there is no tax is given by QS = 5P - 500. The supply function with the tax is QS Tax=5P-860. The demand for this good is given by QD = 340 - P. Calculate the dollar amount of tax revenue from this good.

Homework Answers

Answer #1

Please refer to the attached image for detailed solution.

Please leave a thumbs up if the solution is helpful. Thank you:)

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Question 1 A per unit tax on a good which is levied on the consumer will...
Question 1 A per unit tax on a good which is levied on the consumer will usually cause which of the following? a. The price to rise by somewhat less than the per unit tax b. The price to rise by the amount of the per unit tax c. A rotation in the demand curve which changes its slope. Question 2 Which of the following is/are held constant when writing a demand equation for a good in the form         Qd...
Say that a tax of $10 per unit is levied on a good and at that...
Say that a tax of $10 per unit is levied on a good and at that tax the equilibrium demand for the good is 1000 units. Now say the tax increases from $10 to $11 per unit, and as a result equilibrium demand for the good falls to 950 units. What (approximately) is the MCF associated with the tax (show your work, and explain the steps you are taking)?
In an effort to reduce alcohol consumption, the government of economy XYZ is considering $1 tax...
In an effort to reduce alcohol consumption, the government of economy XYZ is considering $1 tax on each gallon of liquor sold (the tax is levied on producers). Suppose that the demand curve is QD = 500,000- 20000P (where QD is the number of gallons of liquor demanded and P is the price per gallon), and the supply curve for liquor is Qs = 30000P (where Qs is the number of gallons supplied). a. Calculate the before tax equilibrium price...
Suppose the market for cigarettes is characterized by the following information: Qd = 70 – 5P...
Suppose the market for cigarettes is characterized by the following information: Qd = 70 – 5P [Demand] Qs = 3P – 10 [Supply] Suppose the government imposes a sales tax of $2 per unit. Calculate the Dead-Weight- Loss due to the sales tax. [Note: P = price per unit; Qd = thousands of units demanded; Qs = thousands of units supplied]
Consider a competitive market for a good where the demand curve is determined by: the demand...
Consider a competitive market for a good where the demand curve is determined by: the demand function: P = 5+-1*Qd and the supply curve is determined by the supply function: P = 0.5*Qs. Where P stands for Price, QD is quantity demanded and QS is quantity supplied. What is the quantity demanded of the good when the price level is P = $4? Additionally assume a market intervention of the form of per unit $2 tax on the consumption of...
Consider the market for butter in Saudi Arabia. The demand and supply relations are given as...
Consider the market for butter in Saudi Arabia. The demand and supply relations are given as follows: Demand:             QD = 12 - 2P Supply:                Qs = 3P - 3. P is the price of butter. Calculate: Equilibrium price _____________                   2. Equilibrium quantity _____________ Consumer surplus ___________                       4. Producer surplus ___________ Draw the demand and supply graphs. Show the equilibrium price and quantity, consumer surplus and producer surplus in the graph below. Graphs must be on scale. Suppose government imposes...
Question: In question 1, what per unit tax would maximize tax revenue? Find the deadweight loss...
Question: In question 1, what per unit tax would maximize tax revenue? Find the deadweight loss in equilibrium under the tax-revenue-maximizing tax 1. Suppose the demand for village defense in Temeria is Qd=300-2P, and the supply is Qs=4P.
The demand for sugar is given by: QD= 420 -0.25P. The supply of sugar is given...
The demand for sugar is given by: QD= 420 -0.25P. The supply of sugar is given by: QS= 4P -1110. The equilibrium quantity without a tax is 330 units. The government levies a $85 per unit tax on the suppliers of sugar. Calculate deadweight loss from this tax.
. The market for a product is defined by the following demand and supply curves:                             &nbsp
. The market for a product is defined by the following demand and supply curves:                                    Qd=20-7p                                    Qs=-4+5P Assume that a tax for £2 per unit is placed on the product.    (a) Derive the new equilibrium consumer and producer prices and quantity.    (b) By what proportion of the tax does the equilibrium price paid by consumers rise?    (c) Find the amount of tax revenue gained by the government.
Incidence of the tax The supply of fried okra (the tastiest of all foods) is given...
Incidence of the tax The supply of fried okra (the tastiest of all foods) is given by the function Qs = a + bp (with b>0) and its demand is given by Qd = c + dp (with d<0). What is the equilibrium price of fried okra, pe0? The government decides to impose a unit tax t on the supply of all food items (supplier pays the tax). What is the equilibrium price after the tax, pe1? (Hint: replace p...