In the market for headphones, inverse demand is P = 90 — QDand inverse supplyis P = 15+ 2QS. In a bid to prevent hearing loss, the government imposes a tax of T per unit. Calculate how much more consumers pay for headphones (PD —P*)

and how much more producers pay for headphones (P* — PS) at T: 3, T: 9, andT: 18.

[Hint once the first is done, the rest are easy.]

SallyAnne, a type of doll made competitively in England, has recently becomepopular in the United States. However, because the popularity is so recent, onlya limited amount of shipping container space is available to be purchased, acting as a quota on the amount of imports. So, inverse demand is P = 36 —Q0 andinverse supply is P = 2 + Q5, but the quota is 6—1 = 10.

a. Calculate price paid PD, price received P5, and the amount of quota rent.

b. Who receives the quota rent in this scenario?