Draw the supply and demand curves associated with the table below. Price Qs Qd $0.00 50 200 0.50 100 175 1.00 150 150 1.50 200 125 2.00 250 100 (a) What is equilibrium price and quantity? (b) What is equilibrium price and quantity with a $0.75 per-unit tax levied on suppliers? Demonstrate your answer graphically. (c) How does your answer to b change if the tax were levied on consumers, not suppliers? Demonstrate your answer graphically. (d) What conclusion can you draw about the difference between levying a tax on suppliers and consumers?

Suppose that at equilibrium, the price elasticity of demand for wheat is -1.5 and the price elasticity of supply is 0.5. If the government imposes a price ceiling that is 12% below the equilibrium price, this price constraint will lead to: A) A shortage equal to 24% of the equilibrium quantity B) A surplus equal to 24% of the equilibrium quantity C) A shortage equal to 2.4% of the equilibrium quantity D) A surplus equal to 2.4% of the equilibrium quantity

The demand for tomatoes is Q = 40-4P and the supply of tomatoes is Q = P +10. Answer the following questions. (a) Suppose that $1 per unit tax is levied on the consumers. Who bears the economic incidence of this tax? (b) Calculate the deadweight loss (c) Suppose that stores will pay $1 per unit tax directly. What will happen to the "sticker price" on tomatoes? How will the size of the consumer tax burden change? (d) Suppose that tax is increased to $2 per unit on the consumers. Calculate the deadweight loss. Compare the size of the deadweight loss with (b).

2. For a particular commodity, the supply and demands functions are given by S(q) = 2q, D(q) = √192-8q where q is thousands of units and p is the the price per unit in dollars. (a) What is the equilibrium quantity q* and price p*? (b) Calculate the consumer's surplus and interpret your result.