Economics For Today
10th Edition
ISBN: 9781337613040
Author: Tucker
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 4.2, Problem 1YTE
To determine
The
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
A tax on a good with perfectly elastic demand causes the supply to shift from S1 to S2, as shown. Use the area tool to draw the triangle
representing the producer surplus before the tax.
To refer to the graphing tutorial for this question type, please click here.
Price ($)
S2
S1
4 VIEW SOLUTION
A SUBMIT ANSWER
7 OF 14 QUESTIONS COMPLETED
MacBook Pro
Please answer the following. A diagram and one paragraph should help to support your answer.
Question: With consideration for elasticity (especially PED), what would be one industry in which the government instituting a subsidy would make sense and why?
When Price is increased from $40 to $42, the Quantity Demanded falls from 50 units to 45 units, while the Quantity Supplied increases from 50 units to 70 units.
Use this information to:(i) Calculate the Price Elasticity of Demand and the Price Elasticity of Supply.(ii) Give the name of the Price Elasticity of Demand and explain what the coefficient tells you about the product.(iii) Calculate the Total Revenue when price is $42.
Chapter 4 Solutions
Economics For Today
Ch. 4.2 - Prob. 1YTECh. 4.2 - Prob. 2YTECh. 4.2 - Prob. 3YTECh. 4.2 - Prob. 4YTECh. 4.3 - Prob. 1YTECh. 4.3 - Prob. 2YTECh. 4 - Prob. 1SQPCh. 4 - Prob. 2SQPCh. 4 - Prob. 3SQPCh. 4 - Prob. 4SQP
Ch. 4 - Prob. 5SQPCh. 4 - Prob. 6SQPCh. 4 - Prob. 7SQPCh. 4 - Prob. 8SQPCh. 4 - Prob. 9SQPCh. 4 - Prob. 10SQPCh. 4 - Prob. 1SQCh. 4 - Prob. 2SQCh. 4 - Prob. 3SQCh. 4 - Prob. 4SQCh. 4 - Prob. 5SQCh. 4 - Prob. 6SQCh. 4 - Prob. 7SQCh. 4 - Prob. 8SQCh. 4 - Prob. 9SQCh. 4 - Prob. 10SQCh. 4 - Prob. 11SQCh. 4 - Prob. 12SQCh. 4 - Prob. 13SQCh. 4 - Prob. 14SQCh. 4 - Prob. 15SQCh. 4 - Prob. 16SQCh. 4 - Prob. 17SQCh. 4 - Prob. 18SQCh. 4 - Prob. 19SQCh. 4 - Prob. 20SQ
Knowledge Booster
Similar questions
- The demand of world crude oil is described as P=200-1.2Q where P is in $ per barrel and Q is in millions of barrels per day. Recent Ukraine-Russia war pushed the oil price from $90 to $130 a barrel. Please calculate the before and after price elasticities of demand and explain the implications of the change in price elasticity of demand.arrow_forwardAfter calculating the coefficient of price elasticity of demand. What are the rules we used to characterize the price range?arrow_forwardplease plot a graph showing the effect of a government subsidy on the market for surgical masks.arrow_forward
- PriceQuantity20016312689412015What is the elastic of demand when prices rises from $12 to $16? Using midpoint method.Using Midpoint method when the price falls from $8 to $4 the price elasticity of demand is?arrow_forwardSupply and demand :What are some products with high price elasticity of demand and why?arrow_forwardAn annual city permit fee causes the supply curve for hot dogs from food carts to shift from S1 to S2. The fee is based on number of units sold and therefore works like a per-item tax on sellers. Use the area tool to draw the area representing the deadweight loss that is due to the tax. To refer to the graphing tutorial for this question type, please click here. Price ($) 8. S2 S1 7.5 7 6.5 5.5 5 4.5 4 3.5 3 2.5 2 1.5 1 0.5 4 VIEW SOLUTION * SUBMIT ANSWER 7 OF 14 QUESTIONS COMPLETED MacBook Proarrow_forward
- An experiment is conducted that provides the data in the accompanying table. Toll rate Number of vehicles using the tollway per day $8 10,000 $6 12,000 a. What is the absolute value of price elasticity when the toll rate decreases from $8 to $6? Round to the nearest hundredth.arrow_forwardGiven the demand and supply function for a product as Q = 1500 - 3P (Demand) Q = 1100 + 2P (Supply) (i) Find the equilibrium Price and Quantity of the product. (ii) If a GST of $50 is imposed on the product, find its effect on the equilibrium Price and Quantity. (iii) Who is more elastic, the consumer or the seller? With the help of demand and supply curve draw a suitable diagram to show the effect of GST on the equilibrium Price and Quantityarrow_forwardThe Department of Agriculture is interested in analyzing the domestic market for corn. The DA's staff economists estimate the following equations for the demand and supply curves: Qd = 1,600 - 125P Qs = 440 + 165P Quantities are measured in millions of bushels; prices are measured in dollars per bushel. a. Calculate the price elasticities of supply and demand at the equilibrium values. Is demand elastic, inelastic or unit elastic and why? Is supply elastic, inelastic or unit elastic and why? b. The government currently has a $4.50 bushel support price in place. What impact (surplus or shortage) will this support price have on the market? If the government is currently implementing a program that requires it to buy up any surpluses, how much wheat will the government buy?arrow_forward
- Discuss how may the concept of elasticities affect our country’s preference for commercial spaces and malls versus public parks and playgrounds. How does this choice impact the richness of our civic lives? Answer the question using 100-150 words only.arrow_forwardThe supply and demand model for 2lb bags of oranges can be represented by: Ps = 8 + 2Qs Pd = 15 - 1.5Qd The government imposes a price floor of $6/ bag What would be the consequences? Group of answer choices It would immediately benefit only consumers It would immediately benefit onlyproducers There would be no change in the market It would immediately benefit both producers and consumers There would be no legal trade for this productarrow_forwardThe government has increased VAT on some commodities in order to raise revenue. The market for commodity X was at equilibrim before tax at price Ksh. 50 per unit sold and the quantity was 5000 units. Suppose own price elasticity of demand is 0.6 and the elasticity of supply is 1.1 After the government announced tax measures the new market price increased to Ksh. 70 per unit. Calculate the equilibrium price and quantities before tax. Calculate the seller and buyers burden, Explainarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you