Question

2Q Consider a closed economy. Let the demand curve be P = 80 - Q and the supply curve be P = 20 + 2Q .

a) Calculate the equilibrium price and equilibrium quantity. b) Suppose the government sets a price ceiling of $55, what is the amount of excess demand or excess supply? (Write down excess demand or excess supply). c) Suppose the government sets a production quota of 16 units, calculate the equilibrium price and equilibrium quantity. 2. Consider a closed economy. Let the demand curve be P = 80 - Q and the supply curve be P = 20 + 2Q . a) Suppose the government imposes an unit tax of $3/unit, calculate Q’, Pc, Ps and the tax revenue i) assuming the tax is imposed on the consumers ii) assuming the tax is imposed on the producers.

Answer #1

Consider a closed economy. Let the demand curve be P = 80 - Q
and the supply curve be P = 20 + 2Q
a) Calculate the equilibrium price and equilibrium quantity.
b) Suppose the government sets a price ceiling of $55, what is
the amount of excess demand or excess supply? (Write down
excess demand or excess supply).
c) Suppose the government sets a production quota of 16 units,
calculate the equilibrium price and equilibrium quantity.

Again, consider the same scenario, with inverse demand curve and
P=30-Q and supply defined by P= 4Q. Calculate the demand price,
supply price, and equilibrium quantity, whether the intervention is
effective and draw diagrams in any three cases.
Consider a quantity quota Q= 3 imposed by the government
Consider a price ceiling of P= 20 imposed by the
government
Consider a price floor of P= 30 imposed by the government

Let the market demand curve be QD=8-P
and the market supply curve be QS=P. Let
price P be measured in $/unit and let quantity Q
be measured in singular units (i.e. simple count).
Solve for the equilibrium price P* and
quantity Q*.
Now, assume the government imposes a $2/unit tax on consumers,
which leads to wedge/gap between the buyers’ price
Pb and the sellers’ price
PS.
Rewrite the demand and supply curves using Pb
and PS, respectively.
Write down the...

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.

Suppose that the inverse demand for webcams is given by P = 150
– Q and the inverse supply for webcams is given by P = 30 + 2Q.
If the market for webcams faces a quota of 30 units, then what
are the equilibrium price and quantity?
If the market for webcams faces a quota of 30 units and a tax
of $60 per webcam, then what are the equilibrium price and
quantity?
In dollars, what is the tax...

1. Inverse demand is P = 245 – 2Q and inverse supply is P = 20 +
Q. a. What is the equilibrium price and quantity in this market? b.
Graph the supply and demand curves, correctly identifying the
intercepts and equilibrium. c. Is the equilibrium quantity in the
elastic, unit elastic, or inelastic portion of the demand curve?
Explain. d. Suppose inverse supply changes to P = 10 + 0.5Q. Is
this an increase or decrease in supply? Graph...

Suppose that the inverse demand for webcams is given by P = 150
– Q and the inverse supply for webcams is given by P = 30 + 2Q.
(20 points) If the market for webcams faces a quota of 30
units, then what are the equilibrium price and quantity?
(20 points) If the market for webcams faces a quota of 30 units
and a tax of $60 per webcam, then what are the equilibrium price
and quantity?
(10 points)...

The demand curve of a perfectly competitive product is
described by the equation:
P = $1000 – Q where Q =
thousands
The supply curve is given by
P = $100 + 2Q where Q =
thousands
Graph the demand and supply curves; use a grid size of 100.
Calculate the equilibrium price and quantity (carefully state the
units). Find the consumer surplus CS, the producer surplus
PS, and the deadweight loss DWL, carefully stating the units.

The demand for milk is
P = 150 - 2Q
the supply curve is
P = 4Q.
What is the level of consumer surplus at the equilibrium price
and quantity?

A.1. a. Suppose the demand function P = 10 - Q, and the supply
function is: P = Q, where P is price and Q is quantity. Calculate
the equilibrium price and quantity.
b. Suppose government imposes per unit tax of $2 on consumers.
The new demand function becomes: P = 8 – Q, while the supply
function remains: P = Q.
Calculate the new equilibrium price and quantity. c.
Based on (b), calculate the consumer surplus, producer surplus, tax...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 2 minutes ago

asked 2 minutes ago

asked 22 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago

asked 2 hours ago

asked 3 hours ago

asked 3 hours ago

asked 4 hours ago