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Hi can someone help me with this question and with a further easy explanation to understand? Thank you! 5.1 World famous Burpee Beer is brewed
Hi can someone help me with this question and with a further easy explanation to understand? Thank you!
5.1 World famous Burpee Beer is brewed in the small town of West Burpee. Currently, the town of West Burpee lev- ies a $2 per-case tax on all Burpee Beer, and the brewery sells 20,000 cases a year at a total price of $20 per case. The mayor of West Burpee has decided to erect a statue of himself in the town square at a cost of $20,000, and wants to raise the money from additional tax revenue from sales of Burpee Beer. He has asked each of the three town council members to come up with a plan to raise the additional $20,000, and their plans are as follows: Council member Simpson advises increasing the per- case tax by $1, Council member Milhouse advises raising the tax by $2 per case, and council member Flanders advises reducing the current tax by $0.50 per case. For each of the three council member's plans, determine the following a. How many total cases of beer would need to be produced to increase tax revenue by exactly $20,000? b. What is the price elasticity of demand for Burpee Beer if the tax revenue increases by exactly $20,000? c. How much total revenue will Burpee Beer receive if the tax revenue increases by exactly $20,000? in PracticeStep by Step Solution
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