The demand curve for a good is given by the equation p

Reference no: EM13810682

Suppose the demand curve for a good is given by the equation P = 300 - 1/4 Q and the supply curve is given by the equation P = 75 + 1/2 Q, where P represents the price of the good (measured in dollars per unit) and Q represents the quantity of the good (measured in units per week)

Suppose the government imposes a sales tax of $15 per unit on this good. Find the initial equilibrium, the new formula for the demand curve, the change in equilibrium quantity, the post-tax price received by suppliers, and the post-tax price paid by buyers. Illustrate graphically.
Suppose quantity demanded for the good rises by 30 units at every possible price while at the same time quantity supplied rises by 10 units at every possible price. Find the new equilibrium price and quantity in this market. Illustrate graphically.

Reference no: EM13810682

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