If the supply curve is perfectly elastic and the demand curve is downward sloping, what is the
Question:
If the supply curve is perfectly elastic and the demand curve is downward sloping, what is the effect of a \(\$ 1\) specific tax collected from producers on equilibrium price and quantity, and what is the incidence on consumers? Why?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (2 reviews)
i Determine the equilibrium in the absence of a tax Before the tax the perfectly elastic supply curv...View the full answer
Answered By
OTIENO OBADO
I have a vast experience in teaching, mentoring and tutoring. I handle student concerns diligently and my academic background is undeniably aesthetic
4.30+
3+ Reviews
10+ Question Solved
Related Book For
Question Posted:
Students also viewed these Business questions
-
What effect does a $1 specific tax have on equilibrium price and quantity, and what is the incidence on consumers, if the following is true: a. The demand curve is perfectly inelastic. b. The demand...
-
In a free market economy, the demand curve is the graph of the function D that represents the demand for a specific product by the consumers in the economy at price q. It is not surprising that the...
-
Examine changes in price and quantity caused when governments take actions to modify market outcomes. In a perfectly competitive market, the equilibrium price and quantity represent the most...
-
The people on Coral Island buy only juice and cloth. The CPI market basket contains the quantities bought in 2016. The average household spent $60 on juice and $30 on cloth in 2016 when the price of...
-
Suppose the following demand exists for iPhone apps: (a) At $9, what quantity is demanded? (b) If the price drops to $6, what quantity is demanded? (c) Is demand elastic or inelastic in that price...
-
Through the flow, the adjusting valve is gradually closed, so that the flow is linearly reduced, the flow is reduced to zero in 20 s. Try to find the acceleration at point A on the axis of the pipe...
-
Using the fourth-order Runge-Kutta method, solve Problem 11.20. Data From Problem 11.20:- The equations of motion of a two-degree-of-freedom system are given by \(2 \ddot{x}_{1}+6 x_{1}-2 x_{2}=5\)...
-
Tailwind, Inc., produces high-quality but expensive training shoes for runners. The Tailwind shoe, which sells for $210, contains both gas- and liquid-filled compartments to provide more stability...
-
(a) In a vacuum, if a certain ultraviolet photon has 6 times the energy of a green photon, what is the ultraviolet photon's speed relative to that of the green photon? (b) In a vacuum, what is the...
-
If the short-run supply curve for fresh fruit is perfectly inelastic and the demand curve is a downward-sloping straight line, what is the effect of an ad valorem tax on equilibrium price and...
-
Show mathematically the effects on the equilibrium price and quantity of corn from a specific tax of \(t=\$ 2.40\) collected from suppliers, as illustrated in panel a of Figure 3.6. Figure 3.6:- (a)...
-
Suppose that in a p-type semiconductor the ionized acceptor concentration at x = x1, is na = n1 < < nv and falls off exponentially to a value na - = n2 >> n1 at x = x2. What is the build-in electric...
-
Convertible Preferred Stock Charter Company earned net income of $48,000 for the year. The company had 10,000 shares of common stock outstanding during the year and 1,000 shares of noncumulative...
-
Greg, Josh, and Robin are equal partners in GJR Partnership. Robin sells his partnership interest to Kim for $110,000 cash. What is the amount of the optional basis step up to Kim's share of the...
-
The terminal ray of angle , drawn in standard position, passes through the point (-5, 27) What is the value of COS ? Enter your answer, in simplest radical form, in the box. cos B =
-
Sunset Corp. has net cash inflows from operations of $15,000, net cash outflows from investing activities of $2,500, net cash outflows from financing activities of $12,000 and a beginning cash...
-
Business Finance is often associated with the maximisation of shareholder wealth and consideration of other stakeholder perspectives. Investors are constantly concerned about the future returns...
-
CMA Review, Inc., provides review courses twice each year for students studying to take the CMA exam. The cost of textbooks is included in the registration fee. Text material requires constant...
-
The Ranch 888 Noodle Company sells two types of dried noodles:ramen, at $6.50 per box, and chow fun, at $7.70 per box. So farthis year, the company has sold a total of 110,096 boxes ofnoodles,...
-
1. Fashion and Prices. You are in the market for a used car and have narrowed your options to two types of cars, type F and type P. According to Consumer Reports, the two types of cars have roughly...
-
1. Fashion and Prices. You are in the market for a used car and have narrowed your options to two types of cars, type F and type P. According to Consumer Reports, the two types of cars have roughly...
-
1. Fashion and Prices. You are in the market for a used car and have narrowed your options to two types of cars, type F and type P. According to Consumer Reports, the two types of cars have roughly...
-
Provide 5 examples of when to use team or group incentive programs rather than individual incentive programs?
-
Describe some of the major challenges facing HR professionals with respect to decision-making in the recruitment and selection process. Provide a short and concise answer.
-
Write 5000-words on the importance of Data Analytics in Cyber Security.
Study smarter with the SolutionInn App