Consider the market for pork illustrated in the graph. Suppose initial demand (D¹) is Q=280-20p and supply (S¹) is Q=85 +40p and that a $2.75 tax is charged to consumers, shifting the demand curve to D². Using the original and after-tax pork demand functions and the supply function, derive the initial equilibrium price and quantity and the after-tax equilibrium price and quantity. (Enter all responses using real numbers rounded to two decimal places) The equilibrium price is initially $ per kg. (...) p, $ per kg P₁ P₂ 0₂. e₁ D² D¹ Q₂ Q₁ Q, Million kg of pork per year

Consider the market for pork illustrated in the graph. Suppose initial demand (D¹) is Q=280-20p and supply (S¹) is Q=85 +40p and that a $2.75 tax is charged to consumers, shifting the demand curve to D². Using the original and after-tax pork demand functions and the supply function, derive the initial equilibrium price and quantity and the after-tax equilibrium price and quantity. (Enter all responses using real numbers rounded to two decimal places) The equilibrium price is initially $ per kg. (...) p, $ per kg P₁ P₂ 0₂. e₁ D² D¹ Q₂ Q₁ Q, Million kg of pork per year

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter5: Elasticity Of Demand And Supply

Section: Chapter Questions

Problem 1.1P: (Calculating Price Elasticity of Demand) Suppose that 50 units of a good are demanded at a price of...

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