{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Homework3_section8

Homework3_section8 - Sellers Pay Tax(Session 2 $0 $5 $10...

Info icon This preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Experiment 3, Section 8 Problem 3.1 Part a) rise, less than Part b) fall, less than Part c) 165 Part d) about the same as Problem 3.2 Part a) fall, less than Part b) rise, less than Part c) 165 Part d) more than Problem 3.3 Table 3.7: Effects of a Sales Tax on Suppliers $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 0 5 10 15 20 25 30 35 40 Bushels of Apples Price of Apples
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Problem 3.4 Figure 3.8: Effect of a Sales Tax on Demanders In this exercise, the competitive equilibrium price may fall in a discrete range. If that occurs, the mean price in the table below presents that range, and the profits to buyers and sellers are calculated using the midpoint of that range. Problem 3.5 Table 3.8 Competitive Equilibrium Predictions Mean Price $23.00 $33.00 $18.00 Number of Transactions 16 10 10 Total Profit of Buyers $192.00 $65.00 $65.00 Total Profits of Sellers $170.00 $90.00 $90.00 Total Taxes Collected $0.00 $150.00 $150.00 Total of Profits Plus Taxes $362.00 $305.00 $305.00 Excess Burden $57.00 $57.00 Buyers Pay Tax (Session 3) No Tax (Session 1)
Image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Sellers Pay Tax (Session 2) $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 5 10 15 20 25 30 35 40 Bushels of Apples Price of Apples Problem 3.6 Table 3.9 Comparing Theory and Experiment Sellers Pay Buyers Pay Tax (Session 3) Cpmp. Exp. Comp. Exp Prediction Outcome Prediction Outcome Mean Price $33.00 $30.27 $18.00 $18.73 Number of Transactions 10 11 10 11 Total Profit of Buyers $65.00 $92.00 $65.00 $54.00 Total Profit of Sellers $90.00 $60.00 $90.00 $83.00 Total Taxes Collected $150.00 $165.00 $150.00 $165.00 Total of Profits Plus Taxes $305.00 $317.00 $305.00 $302.00 Excess Burden $57.00-$2.00 $57.00 $13.00 Problem 3.7 Part a). Decrease price to $30. Part b). No effect. Part c). No effect. Part d). Decrease profits by $20,000 Part e). No excess burden Problem 3.8 Part a). No effect. Part b). None. Part c). Increase price by $20. Part d). None. Sellers Pay Tax (Session 2)...
View Full Document