a Normal No Spacing Headi 1. (32 points) Suppose the market supply and demand for guitars in Happy Valley are given by: Supply: Q=-60+3P Demand: Q=540-5P. a) (4 points) Calculate the equilibrium price and quantity of guitars. P*= Q*= For the remaining questions, suppose a tax of $24 per guitar is levied on the consumers. b) (6 points) How much will the consumers pay for guitars after the tax? c) (6 points) How much will producers receive for guitars after the tax? Accessibility: Good to go e A DI 12 d) (6 points) What proportion of the tax will be paid by the producers? e) (6 points) What quantity of the good will be bought/sold after the tax? f) (4 points) What is the deadweight loss created by the tax? es) Accessibility: Good to go A MacBook Air 51 M DII AD 12 Focus FIRM A Unit of pollution Marginal Cost of cleaning up this unit 2. (6 points) Suppose there are two firms producing 6 units of pollution each. The government decides that they want to reduce the total pollution to 6 units, so they issue 3 pollution permits to each firm. The cost of abating the pollution for each firm are given in the following table: Marginal Cost of cleaning up this unit FIRM B Unit of pollution of pollution of pollution 2 123456 $6 1 $35 $14 $25 $40 $60 $90 23456 $70 $120 $180 $280 $390 If the two firms work together to reduce the total cost of cleaning up the pollution, how many permits will be traded and which firm will sell the permits and which firm will buy the permits? Accessibility: Good to go MacBook Air 12 Focus 3. (12 points) Suppose a firm's short run production function is given in the following table: L 0123456789 0 25 60 100 130 150 165 170 174 177 10 179 Also, suppose the price of output, Px, is Px = $6. Please complete the following table: Wage rate (w=price of Labor) $110 $25 $15 Accessibility: Good to go # of workers the firm should hire MacBook Air 12 Fo