Question

Question Number 3 please.

1. Assuming the curves on the right are the actual market Demand curve of US buyers and market supply curve for a pint of ale by US producers, determine the following a. The equilibrium price of ale 0.5 b. quantity demanded for ale by buyers = 600.000 potpurday c. quantity supplied of ale by producers 600,000 potpor des 2. Now assume the Government imposes $3/pint tax on the sale of ale and then determine the following a. Draw a new supply curve that is exactly $3/pint higher than the original Supply curve b. the new equilibrium price the buyer will pay for ale 41 c. the new equilibrium price the seller will receive for selling ale will - 1 400. 000 .000 p art of ale premember wer has to s trom the price they wer e the pretthe t d. the new quantity demanded for ale= 400,000 pint/day e the new quantity supplied for ale_400,000 pint day f. the tax revenue collected by the government will = _400,000 X 3 , 12 poco A-B -52/pint paid by buyer. A-D & The portion of the $3/pint tax the buyer will pay will 3-B B - $/pint pard Culler.D The portion of the $3/pint tax the sellers will pay will the new the water reselves from her price the seller received 4 ABC (ly 200000) + 5x 2 200 000 the dead weight loss of imposing the $3/pint tax on the sale of ale 300,000 the Cornumer and producer because the corrionando o dess when toise) 3. Now assume the Government imposes $3/pint tax on the purchase of ale and then, determine the following a. the new equilibrium price the buyer will pay for ale =_ b. the new equilibrium price the seller will receive for selling ale will the new quantity demanded for ale d the new quantity supplied for ale= e the tax revenue collected by the government will f. The portion of the $3/pint tax the buyer will pay will = wtract the original price the buyer peld from new price the buyer pays) receives from the price the seller The portion of the $3/pint tax the sellers will pay will = _ G rad the new price the Nied) the dead weight loss of imposing the $3/pint tax on the sale of ale = _ because the consumption and production of ale decreases when a tax is imposed) the Consumer Surplus and producer plus lost

Answer 1

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Supply 4 - Demand a New equilibrium price buyer will pay $7 3) flew Equilibrium prig seller will receive - 4 c) New Quantity demanded - 4,60,000 pint ( day d) new Quantity supplied - 4,00,000 pint (day es Tax Revenue collected - 40000 x 3= 12,00000 f) Portion of tax paid by buyen- & 2 (7-5) g Portion of tax seller will pay = $1 (5-4) " Deadweight loss DACO -($(7-6) * 2.00000) + 2 ** *2.000* 1 X2 X200000 + Tout 200000 + 1 oooo0 = 300,ooo