Question: Train and bus trips between two towns are provided by separate companies. The demand for train trips is: D1 = 3,000 - 300T1 + 25T2

Train and bus trips between two towns are provided by separate companies. The demand for train trips is:D1 = 3,000 - 300T1 + 25T2 + 3YWhere D1 is annual demand for train trips, T1 is price of train trips, T2 is price of bus trips and Y is average annual income.The supply of train trips by the industry can be described by S1 = 200T1, with S1 being train trips per year, so that demand equals supply (i.e., D1=S1).Y (average annual income) is $75,000 and the price of bus trips is T2 = $500. 1. What is the equilibrium price of train trips?2. How many train trips are provided and purchased?3. Calculate the producer surplus for the train trips providers.Assume the government puts $50/trip tax on producers. Answer the following questions: 4. what is new equilibrium price of train trips to consumers?5. What is the new equilibrium price of train trips to producers?6. How many train trips are produced and sold?

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