Suppose that the demand for vodka is P = 50 ? 2Q, and Supply is P =

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Suppose that the demand for vodka is P = 50 ? 2Q, and Supply is P = 3Q. The government is considering levying a $1 tax on vodka producers.

a) Graphically show, and arithmetically solve for, how the tax changes the equilibrium quantity and price.

b) How much revenue does this tax raise? How much revenue comes from consumers, and how much from producers?

Related Book For answer-question

Mathematical Applications for the Management Life and Social Sciences

ISBN: 978-1305108042

11th edition

Authors: Ronald J. Harshbarger, James J. Reynolds

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Posted Date: May 30, 2018 12:52 AM

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Suppose that the demand for vodka is P = 50 ? 2Q, and Supply is P =

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a Beforetax equilibrium P 10 and Q 300000 Q D Q S 50000020000P30000P 50000... View the full answer

Mathematical Applications for the Management Life and Social Sciences

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