Macroeconomics
11th Edition
ISBN: 9781260506891
Author: Colander
Publisher: MCG
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Question
Chapter 5.1, Problem 8Q
To determine
The impact of imposing tax.
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The equilibrium price of a good is $13$13. Suppose the government introduces a tax on this good. In this case, the price paid by consumers is 1.51.5 times more than the equilibrium price, and the price received by producers is 1.31.3 times less than the equilibrium price. Calculate the amount of tax per good. Enter your answer in the box below and round to two decimal places if necessary.
How do I find the change in equilibrium price after tax?
Suppose that the government imposed a price ceiling on cows. Would you expect theprice of steak to increase, decrease, or stay the same? Explain your answer.
Chapter 5 Solutions
Macroeconomics
Ch. 5.1 - Prob. 1QCh. 5.1 - Prob. 2QCh. 5.1 - Prob. 3QCh. 5.1 - Prob. 4QCh. 5.1 - Prob. 5QCh. 5.1 - Prob. 6QCh. 5.1 - Prob. 7QCh. 5.1 - Prob. 8QCh. 5.1 - Prob. 9QCh. 5.1 - Prob. 10Q
Ch. 5.A - Prob. 1QECh. 5.A - Prob. 2QECh. 5.A - Prob. 3QECh. 5.A - Prob. 4QECh. 5.A - Prob. 5QECh. 5.A - Prob. 6QECh. 5.A - Prob. 7QECh. 5.A - Prob. 8QECh. 5.A - Prob. 9QECh. 5 - Prob. 1QECh. 5 - Prob. 2QECh. 5 - Prob. 3QECh. 5 - Prob. 4QECh. 5 - Prob. 5QECh. 5 - Prob. 6QECh. 5 - Prob. 7QECh. 5 - Prob. 8QECh. 5 - Prob. 9QECh. 5 - Prob. 10QECh. 5 - Prob. 11QECh. 5 - Prob. 12QECh. 5 - Prob. 13QECh. 5 - Prob. 14QECh. 5 - Prob. 15QECh. 5 - Prob. 16QECh. 5 - Prob. 17QECh. 5 - Prob. 1QAPCh. 5 - Prob. 2QAPCh. 5 - Prob. 3QAPCh. 5 - Prob. 4QAPCh. 5 - Prob. 5QAPCh. 5 - Prob. 1IPCh. 5 - Prob. 2IPCh. 5 - Prob. 3IPCh. 5 - Prob. 4IPCh. 5 - Prob. 5IPCh. 5 - Prob. 6IPCh. 5 - Prob. 7IPCh. 5 - Prob. 8IPCh. 5 - Prob. 9IPCh. 5 - Prob. 10IPCh. 5 - Prob. 11IPCh. 5 - Prob. 12IPCh. 5 - Prob. 13IPCh. 5 - Prob. 14IP
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- At the current market equilibrium, the price elasticity of supply for a certain good is much lower than the price elasticity of demand. if the government imposes a $5 specific tax on this good, who will bear more of the burden of the tax?arrow_forwardTaxes on producers cause the equilibrium price of a good toarrow_forwardExplain what would be likely to happen if the government placed a price ceiling of $1/gallon on gasoline. Your answer should consist of a complete well-written paragraph using complete sentences as well as a supply and demand diagram.arrow_forward
- Find the equilibrium price and quantity for a product that has the following supply and demand curves, where p is the price in 100's of dollars and q is quantities in 1,000's of units demand: 1/3q + 1/3p - 4=0 Supply: q-p-2=0 If the product is currently priced at $400, what is the quantity supplied and the quantity demanded? Is there a surplus (More supplied than demanded) or a shortage (More demanded than supplied)arrow_forwardHow can a price ceiling make consumers better off? Under what conditions might it make them worse off?arrow_forwardIf cigarettes and marijuana had been found to be substitutes, what would a tax placed on cigarettes do? decrease the demand for marijuana increase the demand for marijuana decrease the quantity demanded of marijuana increase the quantity demanded of marijuanaarrow_forward
- How does a tax on buyers affect the market equilibrium?arrow_forwardIf the equilibrium price is $10 and equilibrium quantity 10 units, and a price ceiling of $8 is imposed, we can expectarrow_forwardSuppose the government sets a price ceiling above the equilibrium price for milk. Which of the following will be the result?arrow_forward
- If a price ceiling of $7 is set, the quantity of soft drink to be exchanged will be 3. When a price ceiling is set below the equilibrium price, quantity demanded will exceed quantity supplied, and excess demand or shortages will result.arrow_forwardWhat does each part of the graph stand for? Assume that a local government imposes a price ceiling of $8, how many units will be excessively supplied/demanded?arrow_forwardIn a country the Government determines to increase the tax on gasoline by $0.20 per gallon. The price of gasoline after taxes though only goes up by $0.15. Does this mean the gas station is not collecting the correct amount of taxes?arrow_forward
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