Market with an initial equilibrium price

Assignment Help Business Economics

Reference no: EM131392498

a) Draw a supply and demand showing a market with an initial equilibrium price of $2, and an external cost of 30 cents per unit. Suppose the government imposes a corrective tax of 30 cents per unit that raises the equilibrium price by 10%. Show the new supply / social cost curve. Does the quantity rise or fall?

b) Circle the right answer: With positive externalities, an unregulated market will (under / over) provide the good, and the solution is to (tax / subsidize) the good.

Reference no: EM131392498

Questions Cloud

Determine the force in newtons : Deceleration is sometimes measured in g's or multiples of the standard acceleration of gravity. Determine the force, in newtons, that an automobile passenger whose mass is 68 kg experiences if the deceleration in a head-on crash is 50g.

Find the output voltage produced : A 6-bit DAC has an input of and uses a 10.0-V reference.- Find the output voltage produced.- Specify the conversion resolution.

Calculate the multifactor productivity for both systems : Atlantic milk factory needs your consulting advice concerning its business and production processes. The final consulting report describes several steps to increase productivity including implementation of cutting-edge processing techniques throug..

What is the magnitude of the net force : A truck weighs 3300 lb. What is the magnitude of the net force (lb) required to accelerate it at a constant rate of 5 ft/s2? The acceleration of gravity is g = 32.2 ft/s2.

Market with an initial equilibrium price : Draw a supply and demand showing a market with an initial equilibrium price of $2, and an external cost of 30 cents per unit. Suppose the government imposes a corrective tax of 30 cents per unit that raises the equilibrium price by 10%. Show the new ..

What digital input would come closest to given value : An output of 4.740 V is needed. What digital input would come closest to this value? By what percentage is the actual output different?

Draw graph showing monopolistically competitive firm : Draw a graph showing a monopolistically competitive firm in a long-run equilibrium. What are its profits? Suppose instead that a monopolistically competitive firm sells 5 units of a product, for $4/unit, at an average total cost of $2/unit. Calculate..

Specify the requirements of the dac : Specify the requirements of the DAC.- Prepare flowcharts of the software that will generate the wave.

Characteristic of good fiscal system : Characteristics of a good tax system. links between growth of public debt and economic growth. Richard Musgrave"s justification for goverment intervention in the economy. Characteristic of good fiscal system.

User Account

All Pages