Consider the following general demand and supply functions for a given commodity.

Qd=a - bp

Qd= -c+ dp

i.Find the equilibrium price and quantity[4 Marks]

ii.Suppose that a fixed tax t is imposed on the product in question, what is the new equilibrium price and quantity.[6 Marks]

iii.Express the value of t in terms of a, b, c, d, and p.[3 Marks]

iv.Use iii. Above to write the expression for government revenue.[2 Marks]

v.Suppose that instead of a fixed tax, the government decides to set a non-binding price floor equal to. How many units will be supplied and how many units will be demanded to ensure optimal quantities?[5 Marks]