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The demand and supply curve for wheat is:
P= price per bushel of wheat in dollars
Q= Quantity of wheat demanded or supplied in billions of bushels
Please evaluate the effect that different governmental policies would have on the equilibrium price and quantity of wheat. Please note that the quantity of bushels of wheat purchased does not have to be a round number since Q is in billions of bushels.
A) Find the Equilibrium quantity and price if there is no tax or subsidy.
B) Find the Equilibrium price and quantity if the firm receives a subsidy of $2.00/bushel
C) Find the equilibrium price and quantity if the buyer pays a sales tax of 10% on wheat.
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