How will the increase in paint price affect the demand

Reference no: EM133426249

Question: An investigation has recommended changes in the construction industry and estimate it will cost $8 billion. The government wants to impose a 25%tax on pain to recover the cost. The population purchases 1.35 billion litres of pain a year. The price is $1.75/L. With 25% tax on paint, the price will be $2.19L. Price elasticity of demand for paint is -1.89.

How will the increase in paint price affect the demand for paint?

Reference no: EM133426249

Questions Cloud

What was the reaction from colleagues : Did the children like it? Did the adults ask questions? What was the reaction from colleagues? Did the idea turn out the way you planned? What changes might you

Why are price elasticities of demand called elastic : Why are price elasticities of demand called elastic or "inelastic" when other elasticities (income or cross-price) are not?

Tell the story of a time in your life : Tell the story of a time in your life when you felt truly free- this could be any type of freedom such as, physical, emotional, intellectual, etc.

How will the increase in paint price affect the demand : Price elasticity of demand for paint is -1.89. How will the increase in paint price affect the demand for paint

How will the increase in paint price affect the demand : How will the increase in paint price affect the demand for paint - With 25% tax on paint, the price will be $2.19L. Price elasticity of demand for paint

Discuss in detail and with examples one of the five practice : Discuss in detail and with examples one of the five practices and its associated commitments in the context of your present or prior work environment.

What is the implicit premise of this enthymeme : What is the implicit premise of this enthymeme? Answer this question by putting the argument into standard form [see below]. (Do not change the first premise

Make a summary about an article written in science daily : Make a summary about an article written in Science Daily about "Reducing total calories may be more effective weight loss than intermittent fasting","Study

What is the total economic cost of installing : What is the total economic cost of installing a large kitchen on a passenger airplane? Do you agree with the statement that "the best strategy is to know

User Account

All Pages