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3: The equilibrium price and quantity of the Y product is P = 15 v Q = 20. At this equilibrium, the demand elasticity
3: The equilibrium price and quantity of the Y product is P = 15 v Q = 20. At this equilibrium, the demand elasticity is Ep = -0,5 and the supply elasticity is Es = 0,5. The demand and supply curve are linear lines a. Define the demand and supply equations of this Y market. b. Make assumption that the supply decreases 50% after the government put tax on this product. What are the changes of the equilibrium price and quantity? c. After tax, the government continues set the price ceiling P = 15. How the market supply and demand would be like?
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Macroeconomics Principles Applications And Tools
Authors: Arthur O Sullivan, Steven M. Sheffrin, Stephen J. Perez
7th Edition
978-0134089034, 9780134062754, 134089030, 134062752, 978-0132555234
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