What will be the cs ps tax revenues and deadweight loss?, Ask an Expert

Economics

The market for pizza has the following demand and supply schedules:

Price, Quantity demanded, Quantity supplied

$4, 135, 39
$5, 104, 53
$6, 85, 60
$7, 68, 68
$8, 53, 78
$9, 39, 85

Suppose the government decides to tax pizza by $3 (raises supply curve by $3).

a. Draw the demand and supply curves, before and after the tax.

b. What will be the CS, PS, tax revenues and deadweight loss?

c. Suppose the government increases the tax to $4 per unit. What will be the new CS, PS, tax revenues and deadweight loss?

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M9443656

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