Question: Why does a market clear when the government imposes an excise tax of $T per unit?

Why does a market clear when the government imposes an excise tax of $T per unit?

Step by Step Solution

★★★★★

3.32 Rating (155 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

When the government imposes an excise tax the price consumers ... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

846-B-E-D-S (2266).docx

120 KBs Word File

Students Have Also Explored These Related Economics Questions!

Q:

Why does a market clear when the government gives producers a subsidy of $S per unit?

Q:

Widgets are provided by a competitive constant-cost industry where each firm has fixed costs of $30. The following chart shows the industry-wide demand curve and the marginal cost curve of a typical...

Q:

Suppose the government imposes an excise tax of $10 per pair of shoes, but simultaneously launches a program of giving a gift of $10,000 per year to each shoestore. a. In the short run, what happens...

Q:

11. Why does a market clear when the government imposes an excise tax of $T per unit?

Q:

The Following questions are all true or false. these questions have a chance of showing up on my test in the future so I would like to have the answers so I can make flashcards with them. Landlords...

Q:

Price, MR MC 100 65 50 30 35 50"\" 70 100 Quantity Reference: Ref 1318 (Figure: The Monopolist III) Look at the gure The Monopolist III. If this monopolist protmaximizes, it will produce units and...

Q:

Use the following market Demand and Supply equations to answer BOTH questions. (Circle final answers; make sure final answer per section is on this page.) Q d = 50 - .05PQ S = -2 + .01P Be careful...

Q:

In a competitive market with no government intervention, the equilibrium price is $10 and the equilibrium quantity is 10,000 units. Explain whether the market will clear under each of the following...

Q:

Consider a perfectly competitive market with market supply Qs = - 2+P and market demand Qd = 30-P . Suppose the government imposes an excise tax of $4 per unit on this market. What is total surplus...

Q:

Suppose the market for corn in Pulmonia is competitive. No imports and exports are possible. The demand curve is Qd = 10 Pd, where, Qd is the quantity demanded (in millions of bushels) when the price...

Q:

A particle of mass 1.18 kg is attached between two identical springs on a horizontal frictionless tabletop. The springs have force constant k and each is initially unstressed. (a) If the particle is...

Q:

Certain item descriptions and amounts are missing from the monthly schedule of cost of goods manufactured and income statement of Pinta Manufacturing Company. Fill in the blanks with the missing...

Q:

An electronic is a website the represents a single store. Select one: auction mall marketplace storefront

Q:

A project manager is estimating project costs and needs to decide whether the estimates will include direct costs only or include indirect costs, as well. In which of the following phases does this...

Q:

A firm producing hockey sticks has a production function given by q = 2 K L In the short run, the firms amount of capital equipment is fixed at K = 100. The rental rate for K is v = $1, and the wage...

Q:

Returning to the gumball producer in Problem, let us look at the possibility that producing these delectable treats does not necessarily experience constant returns to scale. a. In Problem, we showed...

Q:

Venture capitalist Sarah purchases two firms to produce widgets. Each firm produces identical products and each has a production function given by qi = Ki Li Where i = 1, 2 The firms differ,...

Q:

can someone help with the following information review problem thank you i do not own the orignall rights to the followong information Ilas Company is considering a capital investment of $190,000 in...

Q:

A new building has just opened on campus Unfortunately, the administration has forgotten to budget for replacement light bulbs. The liletime of a bulb has an exponential distribution with a mean of...

Q:

Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable...