Question based on tax effects

Assignment Help Macroeconomics

Reference no: EM1369776

Gus the cab driver rents a cab and pays for gas. In each of the following circumstances, describe the (A) short-run effects & (B) long-run effects on the price and quantity of rides Gus offers. (Use Graphs to aid understanding in A & B)

Question 1 :
The city imposes a $1 excise tax on cab rides, but exempts Gus from the tax because he is a good friend of the mayor.

Question 2 :
The city imposes a $100 annual license fee on cab drivers, but gives Gus a free license because he is a good friend of the mayor.

Part II

This time assume that Gus is subject to the tax and to the license fee (but that he remains in the industry after imposition of each policy), describe the (A) short-run effects & (B) long-run effects on the price and quantity of rides Gus offers. (Use Graphs to aid understanding in A & B)

Question 3 :
The city imposes a $1 excise tax on cab rides.

Question 4 :
The city imposes a $100 annual license fee on cab drivers.

Reference no: EM1369776

Questions Cloud

Calculate the breakeven point : Breakeven Point - calculate the breakeven point using the following information:

Explain lost sales that would have been made : explain lost sales that would have been made with an undifferentiated marketing strategy across all segments

Operations management - productivity ratios : Compute the productivity ratios for the old and new production system - Operations Management - Productivity Ratios

Explain when claudia returned the following week : Explain When Claudia returned the following week to pick up the teach set, Mrs. Jaeger told her that tea set was no longer there. Upon discovering her loss

Question based on tax effects : Gus cab driver rents a cab and pays for gas. In each of following circumstances, describe the short-run effects & long-run effects on the price and quantity of rides Gus offers.

Example on strategic cost management : Under a costing system that uses direct labor hours as a driver for the allocation, how much of the inspection costs would be allocated to Table

Explain what is the eoq and what should be the safety stock : Explain What is the EOQ and What should be the safety stock and What should the reorder point be and An inventory withdrawal of 10 pairs was just made. Is it time to reorder?

Planning function management of global crossing : How has management planning been affected by legal issues, ethics and corporate social responsibility and factors that affect Global Crossing's strategic, tactical, operational and contingency planning

Derive the nash equilibrium of the model : Consider a 2-company Cournot model. Let ci (i=1,2) denote firm i's cost per unit of output produced, and suppose that c1 > c2 .

User Account

All Pages