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The demand curve for oranges is given by the equation P = 5 - Q/200. The supply curve is given by P = Q/800. Q is measured in oranges per day and price is measured in dollars per orange. Suppose the government imposes a tax $0.15 on the sellers of oranges and a tax of $0.35 on consumers simultaneously.
(a) Graph the demand and supply curves (including intercepts!)
(b) Calculate the equilibrium price and quantity before the taxes are imposed.
(c) Calculate the post-tax equilibrium price and quantity.
(d) What price is received by sellers and price paid by consumers after the taxes are imposed.
(e) Calculate the tax revenue collected by the government.
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You are the CEO of Comchip, a firm that sells specialized computers. Each of the firm's computers contain a unique chip that is produced at Comchip's west coast plant at a cost of
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