Homework 3.pdf - Econ 1014 Homework#3 Due by 11:59pm on Wednesday Sept 25 Note that this homework file is only for you to record your answer To complete

Homework 3.pdf - Econ 1014 Homework#3 Due by 11:59pm on...

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Page 1 Econ 1014 Homework #3 Due by 11:59pm on Wednesday, Sept. 25. Note that this homework file is only for you to record your answer. To complete the homework for grading, you must submit your answers through the online homework assignment. 1. (Figure: Tax on Sellers) a) The size of the tax in the diagram is ________. b) In the diagram, buyers pay ______ without the tax and ______ with the tax. c) In the diagram, sellers receive _______ without the tax and ______ with the tax. d) Who bears the greater burden of this tax? (buyers/sellers) Why? e) How much revenue would the government receive from this tax? f) What is the amount of deadweight loss cause by this tax?(6 pts.) 2. What type of deadweight loss results from subsidies? (1 pt.)
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Page 2 3. (Figure: Wage Subsidy) Consider the impact of the use of wage subsidies versus the minimum wage. Employment with a wage subsidy is ________, versus employment with an $8 minimum wage, which is ________.(2 pts.) 4. Figure: Commodity Tax According to the figure, who bears the greater burden of a commodity tax in this market?( 1 pt.) A) The buyer will bear the greater burden of the tax.
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