1. The following equations show the supply and demand for burgers: QD = 40 - 3P...

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1. The following equations show the supply and demand for burgers: QD = 40 - 3P QS = −10+2P (1) Calculate the equilibrium price and quantity. (2) Due to a newly introduced provincial tax, suppliers are only willing to sell for $4 more (hint: the supply curve can be written as P=5+0.5QS, the new supply function is P=5+0.5QS+4). Calculate new supply and new equilibrium price and quantity. (3) Graph the change from (1) to (2) in one graph. (4) Calculate the elasticity shown by the above change. Explain what it means and classify the elasticity. 1. The following equations show the supply and demand for burgers: QD = 40 - 3P QS = −10+2P (1) Calculate the equilibrium price and quantity. (2) Due to a newly introduced provincial tax, suppliers are only willing to sell for $4 more (hint: the supply curve can be written as P=5+0.5QS, the new supply function is P=5+0.5QS+4). Calculate new supply and new equilibrium price and quantity. (3) Graph the change from (1) to (2) in one graph. (4) Calculate the elasticity shown by the above change. Explain what it means and classify the elasticity.

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1 To find the equilibrium price and quantity set supply equals demand QS QD 10 2P 40 3P ... View the full answer