Consider a mineral that is in fixed supply, QS = 4. The demand for the mineral is given by QD = 10 - 2P, where P is the price per Kg and QD is the quantity demanded. The government imposes a tax of $2 per Kg. on the mineral.

i. What is the price paid by the consumer before the tax is imposed, and in the post- tax equilibrium? ii. What is the price received by producers before and after tax? iii. How much revenue is raised?

iv. Is there any dead weight loss of this tax? If yes, what is it?

It is monopoly case