The supply for oat phrase is described by: =

a) What is the equilibrium price and the equilibrium quantity on the market? Show

how you reached your answer.

b) Explain what the price elasticity of demand describes. Calculate

the demand price elasticity for oat phrase at the different price levels:

p = 100, p = 60 and p = 40.

c) Assume that the demand for oatmeal decreases. Reason and explain

what is happening in the commodity and factor market as a result of

demand reduction, and illustrate your reasoning in appropriate

figure / figures. For this sub-question, you do not need to start from the supply and demand function given above if you do not want to.

d) Assume that the state introduces a unit tax on oat phrase producers. Explain

how this affects the consumer price and the producer price. Show with

appropriate figure, and also describe how large the tax revenue to the state is.

For this sub-question, you do not have to start from supply and

the demand function given above if you do not want.