Question: - Consider a market where aggregate demand is: 10000 Qp(p) p2 and aggregate supply is: Qs(p) =p Here, p > 0 denotes the price. (a)

- Consider a market where aggregate demand is:

- Consider a market where aggregate demand is: 10000 Qp(p) p2 and aggregate supply is: Qs(p) =p Here, p > 0 denotes the price. (a) Find the equilibrium price and quantity in this market. (b) What is the total surplus (consumer and producer surplus)? (c) Suppose now that the government introduces an excise unit tax of $2. What is the equilibrium price and quantity in this case? What is the change in total surplus

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Given Aggregate Demand Qpp Qdp 10000 p2 Aggregate Supply Qsp Qsp p Price p p 0 We will now analyze each part of the problem a Find the equilibrium price and quantity in this market In equilibrium the ... View full answer

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