Suppose demand and supply are given by a. Determine the equilibrium price and quantity. Show the equilibrium

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Suppose demand and supply are given by

a. Determine the equilibrium price and quantity. Show the equilibrium graphically.b. Suppose a $6 excise tax is imposed on the good. Determine the new equilibrium price and quantity.c. How much tax revenue does the government earn with the $6tax?

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Managerial Economics and Business Strategy

ISBN: 978-0071267441

7th Edition

Authors: Michael R. baye

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Question Posted: Nov 15, 2011 10:51 AM

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Suppose demand and supply are given by a. Determine the equilibrium price and quantity. Show the equilibrium

Question:

1. Q =7- -P, and Q =-P.- 2

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a b A 6 excise tax shifts the supply curve up by the amount of the tax Mathematically this mean...View the full answer

Managerial Economics and Business Strategy

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