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1. Given below are data for demand and supply curves for footballs.

Price ($): 16 20 24 28 32
Quantity demanded: 90 80 70 60 50
Quantity supplied: 30 50 70 90 110

(a) In this market, the equilibrium price is $24 and equilibrium quantity is $70. (2 points)

(b) Using mid-point elasticity formula, the price elasticity of supply between the price of $24 and $28 is 1.65. (2 points)

(c) Suppose the government imposes a tax on consumers in this market. As a result consumers buy 30 units less at each price. The new equilibrium quantity in this market is 50. (2 points)

(d) After the tax, consumers pay a price of $32 while the sellers receive $20. The government receives a tax of $12 per unit. (2 points)

how we calculate (c) and (d) ??

thank you very much guys

2006-10-26 07:26:07 · 2 answers · asked by huligancho 1 in Business & Finance Taxes United States

I just need to know how we do it - there is nothing in the book

2006-10-26 07:44:07 · update #1

2 answers

What kind of accountant will you be if you look for others to do your homework?

2006-10-26 07:33:21 · answer #1 · answered by Judy 7 · 0 0

(c)
Price ($): 16 20 24 28 32
Quantity demanded: 60 50 40 30 20 (each is 30 less than original)
Quantity supplied: 30 50 70 90 110

(d) this sounds more like an answer that a question.

2006-10-26 13:37:28 · answer #2 · answered by STEVEN F 7 · 0 0

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