Macroeconomics (7th Edition)
7th Edition
ISBN: 9780134738314
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 4, Problem 4.4.8PA
To determine
The impact of tax on pizza.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Due to the government's program for developing alternative fuels, the demand for ethanol has increased dramatically. Ethanol is made from corn. Corn is also used as a feed for hogs. Simultaneously, many more cases of mad cow disease have been discovered in the United States. Assume that pork and beef are substitutes in consumption, but not in production. As a result of these two changes, what will happen to the price and output of pork? Briefly explain.
Q.4.1 Read the excerpt in the textbox and use the information to answer the question
below:
http://clipart-library.com/citrus-cliparts.html
Adapted from the Farmer's Weekly. Written by Siyanda Sishuba
A strong increase in global demand for citrus has so far been
evident in the 2020 export season, according to Justin Chadwick,
CEO of the Citrus Growers' Association of Southern Africa.
In a statement, Chadwick said increased global demand for lemons
had resulted in 4,5 million 15kg-equivalent cartons being shipped to
date. This was double the 1,8 million cartons exported during the
same period in 2019.
https://www.farmersweekly.co.za/agri-news/south-africa/strong-demand-for-sa-
citrus-at-start-of-2020-export-season/[Accessed 19 March 2021].
With reference to the excerpt above, and assuming that the majority of the
sales of citrus are going to Europe, explain the impact this increase in the
demand for citrus fruit will have on the rand/euro exchange rate and the value
of the rand.
Use a…
Economics
Use the following information
$6.00
Sell 6 million razors
Variable cost = $3.00
Price elasticity = -3
Linear demand curve
Price for a razor =
Now, suppose the cost to produce a blade is $0.25. if you charge $0.35 for a
blade, a customer buys an average of 100 blades from you. A profit per blade is
$0.10. Assume the price elasticity of demand for blades is -3.
What price should you charge for a razor and for a blade? Choose the nearest
answer choice. (note: blade profit = razor demand x profit per blade x blade
demand)
%3D
Chapter 4 Solutions
Macroeconomics (7th Edition)
Ch. 4.A - Prob. 1RQCh. 4.A - Prob. 2RQCh. 4.A - Prob. 3RQCh. 4.A - Why would economists use the term deadweight loss...Ch. 4.A - Prob. 5PACh. 4.A - Prob. 6PACh. 4.A - Prob. 7PACh. 4.A - Prob. 8PACh. 4.A - Prob. 9PACh. 4 - Prob. 1TC
Ch. 4 - Prob. 2TCCh. 4 - Prob. 4.1.1RQCh. 4 - Prob. 4.1.2RQCh. 4 - Prob. 4.1.3RQCh. 4 - Prob. 4.1.4RQCh. 4 - Prob. 4.1.5PACh. 4 - Prob. 4.1.6PACh. 4 - Prob. 4.1.7PACh. 4 - Prob. 4.1.8PACh. 4 - Prob. 4.1.9PACh. 4 - Prob. 4.1.10PACh. 4 - Prob. 4.1.11PACh. 4 - Prob. 4.1.12PACh. 4 - Prob. 4.1.13PACh. 4 - Prob. 4.1.14PACh. 4 - Prob. 4.2.1RQCh. 4 - What is economic efficiency? Why do economists...Ch. 4 - Prob. 4.2.3PACh. 4 - Prob. 4.2.4PACh. 4 - Prob. 4.2.5PACh. 4 - Prob. 4.2.6PACh. 4 - Prob. 4.2.7PACh. 4 - Prob. 4.2.8PACh. 4 - Prob. 4.2.9PACh. 4 - Prob. 4.2.10PACh. 4 - Prob. 4.3.1RQCh. 4 - Prob. 4.3.2RQCh. 4 - Prob. 4.3.3RQCh. 4 - Prob. 4.3.4RQCh. 4 - Prob. 4.3.5PACh. 4 - Prob. 4.3.6PACh. 4 - Prob. 4.3.7PACh. 4 - Prob. 4.3.8PACh. 4 - Prob. 4.3.9PACh. 4 - Prob. 4.3.10PACh. 4 - Prob. 4.3.11PACh. 4 - Prob. 4.3.12PACh. 4 - Prob. 4.3.13PACh. 4 - Prob. 4.3.14PACh. 4 - Prob. 4.3.15PACh. 4 - Prob. 4.3.16PACh. 4 - Prob. 4.3.17PACh. 4 - Prob. 4.3.18PACh. 4 - Prob. 4.3.19PACh. 4 - Prob. 4.4.1RQCh. 4 - Prob. 4.4.2RQCh. 4 - Prob. 4.4.3RQCh. 4 - Prob. 4.4.4RQCh. 4 - Prob. 4.4.5PACh. 4 - Prob. 4.4.6PACh. 4 - Prob. 4.4.7PACh. 4 - Prob. 4.4.8PACh. 4 - Prob. 4.4.9PACh. 4 - Prob. 4.4.10PACh. 4 - Prob. 4.2CTE
Knowledge Booster
Similar questions
- Draw a graph of a competitive market in equilibrium, and illustrate a decrease in Supply. Carefully label everything. Use the "E" labels to label the equilibrium points. As a result of the shift, what will happen to price and quantity? Carefully explain the mechanism that causes price to adjust after the shift, and illustrate it on your graph. Carefully label everything on the graph. Use the boxes below to type your answer. If you reach the line that divides the left side from the right side, start a new line in the next box down. If you do not use all of the boxes, put an "x" in the boxes you do not use.arrow_forwardIn 2020 the UK government introduced a sales tax on all products bought online from overseas. Please note this is not a tariff – it is a tax. The tax will be 2% of the value of the products sold in the UK. This tax is collected from online sellers such as Amazon or ebay. Source: BBC (2019). See link: https://www.bbc.com/news/business-50656106 Consider the market for online products. The initial market equilibrium is at 10 million products sold per year at an average price of $500 each. Then, the UK government imposes a tax on the market, collected from sellers (for example Amazon and ebay). The tax is 2% per item (each item has an average price of $500). Show the effect of this on the market for online products. Show the effect on consumers of online products, on the online sellers and on the government. Does the UK economy gain or lose as a result of the tax? Explain why. Use a diagram to support your answer.arrow_forwardSuppose that there are two companies that produce mobile phones: Brand A and Brand B. Explain how each of the following events will affect the market for Brand A phones by using supply and demand diagrams (mention the changes in equilibrium price and quantity): a) Price of Brand B phones increased. b) Brand A's factory's production capacity dropped because of a shortage in raw materials supplies. c) Brand A has developed a new technology that allows to assemble the phone's components in a cheaper way.arrow_forward
- What is a competitive market? Briefly describe the types of markets other than perfectly competitive markets.arrow_forwardI recently stumbled upon the following quote in a newspaper: "Increased production (i.e. an increase in supply) leads to a lower price; which in turn, increases demand." Do you agree with such reasoning? Briefly explain.arrow_forwardIn 2016, Walmart closed 150 stores in the United States and deeply discounted the merchandise in them. Some people bought the merchandise at these low prices and resold it on Amazon, eBay, and other sites. An article in the Wall Street Journal described one reseller who: "sent three employees in a 26-foot truck to the nearest closing Walmart, about 160 miles south. They hauled off $35,000 in merchandise, like Legos and Star Wars pajamas, which he said he expects to sell for as much as $100,000 on Amazon." Source: Greg Bensinger, "Wal-Mart Closures Bring Out the Amazon Sellers," Wall Street Joumal, January 29, 2016. Is the reseller making a $65,000 profit on these goods? Briefly explain. OA. Yes, the seller is making a $65,000 profit because his revenue is $ 100,000 and his cost is $35,000. B. No, the seller is making less than $65,000 because he incurs transactions costs. c. Yes, the seller is actually earning a $100,000 profit because the $35,000 is a sunk cost. D. No, the seller is…arrow_forward
- Why does the demand curve slope downward? Briefly explain.arrow_forwardExplain briefly what is a supply curve.arrow_forwardMacmillan Learning John and Michael are the only consumers in a town that is planning on putting on a fireworks display. The graph illustrates John's and Michael's demand curves for a fireworks display. Based on the information given in the graph, manipulate the movable demand curve to reflect the overall demand for the fireworks display. Cost ($) 4 3 2 5 12 11 10 9 287 John's demand 6 Michael's demand 1 0 0.0 1.0 2.0 Quantity Demand 3.0 What kind of good is a fireworks display? O quasi-public good public good private good common resourcearrow_forward
- The following graph displays four supply curves (HH, II, JJ, and KK) that intersect at point A. 200 180 160 140 B 120+ A 100 80 40 K 20 20 40 60 80 100 120 140 160 180 200 QUANTITY (Units) Using the graph, complete the table that follows by indicating whether each statement is true or false. Statement True False Between points A and D, curve JJ is elastic. Between points A and E, curve HH is unit elastic. Curve JJ is more elastic between points A and D than curve KK is between points A and C. PRICE (Dolars per unit) O ooarrow_forwardCopy of The following graph displays four supply curves (HH, II, JJ, KK) that intersect at point A. PRICE (Dollars per unit) 400 360 320 280 240 200 160 120 80 40 0 H 0 40 80 A SE H + 120 160 200 240 280 320 360 400 QUANTITY (Units) Using the graph, choose the statements that are true: Between points A and C, curve KK is inelastic. Between points A and B, curve II is perfectly inelastic. Curve KK is more elastic between points A and C than curve JJ is between points A and D. Between points A and E, curve HH is perfectly inelastic.arrow_forwardUse a supply and demand graph to show the impact of the following on the equilibrium price and quantity in the market for Texas Instrument calculators. [You will upload your graphs at the end.] Casio calculators announces higher prices for consumers and at the same time Texas Instrument negotiates a much lower monthly rent on their lease.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning