Good X is produced in a competitive market using input A. Explain what would happen to the supply of good X in each of the following situations:a. The price of input A decreases.It will not change.It will increase.It will decrease.b. An excise tax of $3 is imposed on good X.It will not change.It will increase.It will decrease.c. An ad valorem tax of 7 percent is imposed on good X.It will increase.It will not change.It will decrease.d. A technological change reduces the cost of producing additional units of good X.It will increase.It will decrease.It will not change.

Answering first three parts as per guidelines Buyers and sellers meet each other to buy and sell…

Answered: Good X is produced in a competitive…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Good X is produced in a competitive market using input A. Explain what would happen to the supply of good X in each of the following situations:

a. The price of input A decreases.

It will not change.
It will increase.
It will decrease.

b. An excise tax of $3 is imposed on good X.

It will not change.
It will increase.
It will decrease.

c. An ad valorem tax of 7 percent is imposed on good X.

It will increase.
It will not change.
It will decrease.

d. A technological change reduces the cost of producing additional units of good X.

It will increase.
It will decrease.
It will not change.

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