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Among the tax proposals regularly considered by Congress is an additional tax on distilled liquors. The tax would not apply to beer. The price elasticity of supply of liquor is 4.0, and the price elasticity of demand is -0.2. The cross-elasticity of demand for beer with respect to the price of liquor is.
a. If the new tax is imposed, who will bear the greater burden-liquor suppliers or liquor consumers? Why?
b. Assuming that beer supply is infinitely elastic, how will the new tax affect the beer market?
Determine what changes (if any) in the relative proportions of labor and materials are needed to operate efficiently
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write a report based on the podcasts & the news article in the text and a critique as well (do you agree with Mankiw's view that "Consenting adults should be able to make economic trades
Recognize three well-founded reasons supporting the potentially beneficial role for government intervention in the workings of private marketplace.
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Derive the firm's supply curve, expressing quantity as a function of price. Derive the market supply curve if North Carolina Textiles is one of 1,000 competitors. Calculate market supply per day at a market price of $47 per unit.
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Airway Express has an evening flight from Los Angeles to New York with an average of 80 passengers and a return flight the next afternoon with an average of 50 passengers.
When Wal-Mart locates in a smaller town, often the local retailers (e.g., hardware, clothing, and appliance stores) are unable to successfully compete and are driven out of business.
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