Question
Consider the market for laptop computers. The demand for laptops is Q = 1800 3P. Suppose the supply of laptops is given by Q =
Consider the market for laptop computers. The demand for laptops is Q = 1800 3P. Suppose the supply of laptops is given by Q = 200 +2P. What is the equilibrium price of laptops? What is the equilibrium quantity of laptops? What is the price elasticity of demand at the equilibrium price and quantity? What is the price elasticity of supply at the equilibrium price and quantity? Suppose a per-unit excise tax of $80 per laptops is levied on the consumers. What price will sellers receive after the tax is levied? What price will consumers pay after the tax is levied? What percent of the tax will be paid by the consumers of laptops? What percent of the tax will be paid by the suppliers of laptops? How many laptops will be sold after the tax is imposed? How much consumer surplus do consumers get after the tax? What is the deadweight loss created by this tax?
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