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28 Sep 2019
Consider the market for gasoline. In the initial equilibrium, theprice is $2.00 per gallon and the quantity is 100 million gallons.The price elasticity of demand is 0.70, and the price elasticity ofsupply is 1.0. Suppose a carbon tax shifts the supply curve upwardby $0.34 and to the left by 7 percent.
After reviewing the price-change formula in the earlier chapter onelasticity, compute the new price and quantity. The new price is$_________ per gallon and the new quantity is _____________ milliongallons.Consumers pay $_____________ of the $0.34 tax and producerspay the remaining $______________ of the tax.
Consider the market for gasoline. In the initial equilibrium, theprice is $2.00 per gallon and the quantity is 100 million gallons.The price elasticity of demand is 0.70, and the price elasticity ofsupply is 1.0. Suppose a carbon tax shifts the supply curve upwardby $0.34 and to the left by 7 percent.
After reviewing the price-change formula in the earlier chapter onelasticity, compute the new price and quantity. The new price is$_________ per gallon and the new quantity is _____________ milliongallons.Consumers pay $_____________ of the $0.34 tax and producerspay the remaining $______________ of the tax.
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RonaldLv2
28 Sep 2019