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Unformatted text preview: y = q x 2 1 + x 2 2 . The demand function is q D ( p ) = a-bp , where a > ,b > 0. Compute the long run equilibrium number of rms in the market, and the quantity of output that each rm produces. 4. The demand curve for a good is q D ( p ) = 100-p , and the supply is q S ( p ) = 20 + 3 p . Compute the equilibrium price and quantity. Suppose that the government need to collect 308 in revenues. The gov-ernment can choose between a per unit tax on t on production and a per unit tax t on consumption. Find the values of t and t . If the government wants to minimize the dead weight loss, which tax should it choose? 1...
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- Fall '09