4. (8 marks) The inverse market demand and market supply for whiskey are as follows (P...

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4. (8 marks) The inverse market demand and market supply for whiskey are as follows (P is in dollars per liter and Q is in millions of liters): PD-30 QDps 2 Q a. Find the equilibrium price and quantity in the whiskey market. b. To discourage consumption of whiskey, the government imposes a per unit tax, t = $6 on whiskey. What is the effect of the tax on the equilibrium quantity and price? What percent of the tax is borne by consumers and by producers? c. Draw a demand-supply diagram to show your results in (a) and (b) diagrammatically. d. What is the effect of an increase in t on the equilibrium quantity of whiskey in general? Obtain an expression for equilibrium quantity and show how it changes when t changes. 4. (8 marks) The inverse market demand and market supply for whiskey are as follows (P is in dollars per liter and Q is in millions of liters): PD-30 QDps 2 Q a. Find the equilibrium price and quantity in the whiskey market. b. To discourage consumption of whiskey, the government imposes a per unit tax, t = $6 on whiskey. What is the effect of the tax on the equilibrium quantity and price? What percent of the tax is borne by consumers and by producers? c. Draw a demand-supply diagram to show your results in (a) and (b) diagrammatically. d. What is the effect of an increase in t on the equilibrium quantity of whiskey in general? Obtain an expression for equilibrium quantity and show how it changes when t changes.

Answer rating: 100% (QA)

a Yields to maturity from banks point of view M1 10 years 6 rate 6 M2 5 years 4... View the full answer