Help, economics, Microeconomics

Assignment Help:
A monopolist faces the inverse demand for its output:
p = 30 – Q The monopolist also has a constant marginal and average cost of $4/unit. The government is seeking ways to collect tax revenue from the monopolist and faces two proposals:
i. Impose a specific tax of t on the monopolist.
ii. Impose an ad valorem tax of a on the monopolist. a. Suppose the government imposes a 20% ad valorem tax on the monopolist. What price and quantity does the monopolist choose and how much revenue does the government generate from the tax? b. Rather than an ad valorem tax, what is the government’s revenue from a specific tax of t imposed on the monopolist? Your answer should be in terms of ‘t’. c. Show that a specific tax of $3.70/unit generates the same revenue as a 20% ad valorem tax (approximately).

Related Discussions:- Help, economics

Describe about capitalism, Q. Describe about Capitalism? Capitalism: An...

Q. Describe about Capitalism? Capitalism: An economic system in that privately-owned businesses and companies undertake most economic activity (with the goal of generating priv

MIF, What is the purpose of the IMF and why might the IMF be called the “le...

What is the purpose of the IMF and why might the IMF be called the “lender of last resort”? Discuss how three of the tools they use for establishing economic stability in a country

CONSUMER BEHAVIOR, DISCUSS THE HICKSIAN & SLUTSKIAN APPROACH TO CONSUMER BE...

DISCUSS THE HICKSIAN & SLUTSKIAN APPROACH TO CONSUMER BEHAVIOR WHERE THERE IS CHANGE IN PRICE OF ONE GOOD GIVEN TWO GOODS

Calculates suspicion of government , Implicit in these analyses is the fact...

Implicit in these analyses is the fact that without government we could have neither shortage nor surplus.  In large calculates, the suspicion of government is due to it has the po

Draw the budget line, Assume you go to the market to buy apples (x1) and or...

Assume you go to the market to buy apples (x1) and oranges (x2) and discover that the price of apples is 1 euro per unit and the price of oranges is 1 per unit when you buy less th

Describe stabilisation policies as by the imf, Describe stabilisation polic...

Describe stabilisation policies as by the International Monetary Fund (IMF). Define stabilisation policies as basically a list of demands set forward by the IMF to a debtor nat

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd