Question

Consider the market for hiking boots. This market can be represented by the following supply and demand equations: Q=100–2P (demand) and Q= –20 +P (supply)

a. Graph the supply and demand curves, labeling the axes clearly. Calculate the equilibrium price and quantity in this market (Q represents a pair of boots), and label these points on the graph.

b. Calculate consumer surplus, producer surplus, and net benefits in the market for hiking boots.

Answer #1

Consider the market for hiking boots. This market can be
represented by the following supply and demand equations: Q=100–2P
(demand) and Q= –20 +P (supply)
a. Suppose that a tax of $5 is imposed on each pair of boots.
With the tax of $5 , find the price that consumers pay, the price
that firms receive, and the quantity exchanged.
b. In which case—relatively elastic demand or relatively
inelastic demand—would tax revenues be higher? Illustrate
graphically.

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Supply:
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2. Equilibrium quantity _____________
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1 Demand and Supply - Market Equilibrium
Suppose the demand and supply of meals in the Free Spech Cafe in
Berkeley is given by Q^D =50−2p and Q^S =2p−10.
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a.) solve for equilibrium price and quantity
b.) draw the supply and demand curves and the equilibrium
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c.) Calculate the consumer surplus and producer surplus in this
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1) Suppose the domestic supply (QS U.S.) and demand (QDU.S) for
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(i) Would this market be considered efficient?
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A market has supply and demand curves that follow the following
set of equations: Supply → P = 4QS + 10 Demand → P = -5QD + 280.
For both of these problems pictures are not required but the
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