3. Incidence and Efficiency Cost of Taxation Consider the following model for the Cal Bears tickets market in Berkeley. Suppose the aggregate demand for the tickets is given by Q = 40, 000 400F where P denotes the price and () denotes the quantity of tickets demanded. The aggregate supply for Cal Bears games tickets is given by Q = 3,000P. (a) Compute the tickets market equilibrium. What are the equilibrium price and quantity? (b) Calculate the price elasticity of supply and the price elasticity of demand at the equi- librium. Compare the values and explain which side you would expect to face a higher incidence if a tax is levied on tickets. (c) Now suppose a tax of t = $5 is imposed on each ticket that is purchased. Compute the tickets market equilibrium with the tax. What are the equilibrium price and quantity? (d) What is the incidence of the tax? What two key parameters determine the incidence of the tax? Explain the intuition for how these determine the result. (e) Compute and graphically depict deadweight loss due to the tax (The graph doesn't have to be in scale, just make sure you write down the important information)