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Course: Microeconomics - Supply and Demand Source: Book Microeconomics - Robert Frank Many studies have shown that charcoal grilled meat is carcinogenic. A solution has

Course: Microeconomics - Supply and Demand Source: Book Microeconomics - Robert Frank Many studies have shown that charcoal grilled meat is carcinogenic. A solution has been proposed to reduce the consumption of grilled meat by imposing a 100% tax on the retail sale of charcoal. Assume that the daily demand for charcoal was P = 120 - 2Q and the supply was P = 30 + Q, where P is expressed in dollars and Q is the number of 20-kilogram bags of charcoal sold per week. a) What is the price and quantity of coal before and after the tax? b) How is the tax divided between sellers and buyers?

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