Price (dollars per bucket) 16 15 14 13 12 10 200 300 400 500 600 700 800 Quantity (buckets) The above figure shows the market for buckets of golf balls at the driving range. A new leisure time tax is placed on suppliers in this market, shifting the supply curve from So to S1. The tax incidence is A) such that buyers pay $1 per bucket and sellers pay $2 per bucket. B) split equally between buyers and sellers, each paying $1 per bucket. C) such that buyers pay $2 per bucket and sellers pay $1 per bucket. D) split equally between buyers and sellers, each paying $2 per bucket. %3D

Price (dollars per bucket) 16 15 14 13 12 10 200 300 400 500 600 700 800 Quantity (buckets) The above figure shows the market for buckets of golf balls at the driving range. A new leisure time tax is placed on suppliers in this market, shifting the supply curve from So to S1. The tax incidence is A) such that buyers pay $1 per bucket and sellers pay $2 per bucket. B) split equally between buyers and sellers, each paying $1 per bucket. C) such that buyers pay $2 per bucket and sellers pay $1 per bucket. D) split equally between buyers and sellers, each paying $2 per bucket. %3D

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter6: Elasticities

Section: Chapter Questions

Problem 5P

See similar textbooks

Similar questions

Describe the general appearance of a demand or a supply curve with infinite elasticity.
Genovia has experienced exceptional growth in recent years. Its GDP per capita (orIncome) has increased from around $30,000 to $50,000 in last 5 years. Over theperiod quantity demanded of personal cars has increased from 450,000 units per yearto 600,000 units. Quantity demanded of public transport, however, has declined from10,000 buses to 7,000 buses. Calculate income elasticity of demand and tell whichproduct is a normal good and which one is inferior.
Using the table below calculate the cross-price elasticity of flour with respect torice [4 marks]P1 P2 Q1 Q2Flour $9 $12 $40 $ 25Rice $4.45 $6.75 $150 $125
Price (dollars per tire) S + tax 70 60 50 40 D 30 20 10 10 20 30 40 50 60 70 Quantity (millions of tires per month) The figure above shows the market for tires. The government has imposed a tax on tires, and the sellers tax burden is A) $50 B) $10 C) $60 D) $20
Price (dollars per gallon of ice cream) 20 18 16 14 12 10 8 50 100 150 200 250 300 350 Quantity (thousands of gallons of ice cream) The above figure shows the market for gourmet ice cream. In effort to reduce obesity, government places a $2 tax per gallon on suppliers in this market, shifting the supply curve from So to S1. The tax incidence is A) split equally between consumers and producers, each paying $1 per gallon. B) such that consumers pay $2 per gallon and producers pay $1 per gallon. C) split equally between consumers and producers, each paying $2 per gallon.
32. Assuming a $7 per unit tax is imposed, the new price to sellers will be $______. a) 10 b) 12 c) 14 d) 16 e) 19 f) 28 g) 36 h) 48 i) 66 j) 70 k) 84
The market supply and demand for a product are shown in the diagram below. PRICE $6 Supply Demand 80 200 QUANTITY (a) Is the price elasticity of supply less than one, equal to one, or greater than one? Explain. (b) Calculate consumer surplus at the equilibrium price. Show your work. (C) Now suppose the government imposes a per-unit tax of $1 on producers. (i) What happens to total revenue received by producers after they pay the tax to the government? Explain. (ii) Will producer surplus increase, decrease, or stay the same? (iii) Will total surplus increase, decrease, or stay the same? Explain.
Only typed answer Green et al. (2005) estimate that demand elasticity is -0.47 and supply elasticity is 12.0 for almonds. If the government were to apply a specific tax to this commodity, what incidence would fall on consumers?
Suppose the demand ourve for a product is given by Q-14-1P+ 2Ps where Pis the price of the product and Pg is the price of a substitute good. The price of the substtute good is $2.30. Suppose P-$1.00. The price elasticity of demand is -0.055 (Enter your response rounded to two decimal places.) The cross price elasticity of demand is 0 261. (Entor your response rounded to two decimal places.) Suppose the price of the good, P, goes to $2.00. Now the price elasticity of demand is(Enter your response rounded to two decimal places.)
Exit A 5 tax on sugar-sweetened beverages currently generates $400,000 in revenue per day. If the tax increases to 8%, the revenue the tax generates will drop to $370,000. This tells us that in this range of tax rates, the effect outweighs the effect. Multiple Choice quantity, price O quantity, Income price; quantity price, Income
What is the total surplus : Price 110 - Supply 100 a) 800 b) 1000 c) 1500 d) 2000 e) 2500 f) 3500 g) 5000 90 80 70 60- Demand 50 45 40 + 30 20 10 ++++++ 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 Duantity
18 $14 The figure above shows a market for admittance into an ice skating rink. A tax has been imposed on the suppliers in the market. According to the graph, the absolute value of the the absolute value of the price elasticity of price elasticity of supply is demand. less than not comparable to equal to C d greater than