2. Suppose the demand for a commodity depends on the price per unit P according to D = a – bP, but that a tax of t per unit is imposed on the consumers. The constants a and b are positive. The supply function is S = g(P), where g'(P) > 0. %3D a. Express the equilibrium condition in the marker for this commodity. b. The equilibrium equation defines P as a differentiable function of t. Find dP/dt and determine its sign. c. What happens to the price P + t paid by the consumers when t increases?

Suppose demand and supply are given by:Qx d = 14 −  2Px and Qx s = 14Px-2b. Suppose a $12 excise tax is imposed on the good. Determine the new inverse demand function.

Let demand and supply be given by, Qd = 270 1P, Qs = -80 +9P. - If a tax is levied on consumers, price for the good. about half most none very little of the tax will be passed on to buyers in the form of a higher

5. Suppose the quantity of good X demanded by individual 1 is given by X₁ = 10-2Px +0.011₁ +0.4Py and the quantity of X demanded by individual 2 is X₂ = 5- Px +0.0212 +0.2Py a) What is the market demand function for total X (= X₁+X₂) as a function of Px, I1, I2, and Py. b) Graph the two individual demand curves (with X on the horizontal axis, Px on the vertical axis) for the case I₁ = 1000, I2 = 1000, and Py = 10. c) Using these individual demand curves, construct the market demand curve for total X. What is the algebraic equation for this curve? 2 d) Now suppose I increases to 1100 and I2 decreases to 900. How would the market demand curve shift? How would the individual demand curves shift? Graph these new curves. e) Suppose Py rises to 15. Graph the new individual and market demand. curves that would result.