5. This question concerns surplus and the effect of taxes. Use the same information as above, and suppose N = 400. (3) Draw market demand and supply function on a single gure, and denote the equi- librium outcome. Label the areas that represent consumer surplus and producer surplus. (b) Calculate the value of consumer surplus and producer surplus in this case. (c) Recall that producer surplus represents the sum of prots and xed costs across all rms. Does your answer to (b) align with the implications of 3(a)? (d) Suppose a unit tax of t = 0.2 is imposed on each piece of output sold, so that consumers pay p+t when the price is p. What is the new market demand function? (e) Solve for the new equilibrium outcome after the tax is imposed. (I?) On a new gure, draw the old and new demand functions and the supply function, and denote the old and new equilibrium outcomes. Carefully label the areas that represent consumer and producer surplus, tax revenue, and deedweight loss imposed by the tax. (3] Calculate consumer surplus, producer surplus, tax revenue collected, and the deadweight loss after the tax is imposed. As a check on your work, the sum of these four values should equal market surplus before the tax is imposed. 01) On the gure you drew in (d), carefully draw a line segment separating the portion of the tax effectively paid (or home) by consumers vs producers, then calculate these values. Who pays more of the tax? Carefully explain why. 2. This question will walk you through the process of solving for the short run competitive equilibrium of a. market. Throughout this question, each consumer's individual demand function for the good is given by (Mp) = 3 2;), where p is the price of the good. Moreover, each rm's supply function is given by s; (p) = gp