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posledela
3 years ago
12

Suppose a tax of $4 per unit is imposed on a good, and the tax causes the equilibrium quantity of the good to decrease from 2,00

0 units to 1,700 units. The tax decreases consumer surplus by $3,000 and decreases producer surplus by $4,400. The deadweight loss of the tax is
a. $200.
b. $400.
c. $600.
d. $1,200.
Business
1 answer:
Marina CMI [18]3 years ago
4 0

Answer:

option (c) $600

Explanation:

Given:

Tax = $4 per unit

Initial equilibrium quantity = 2,000 units

Final equilibrium quantity = 1,700 units

Decrease in consumer surplus = $3,000

Decrease in consumer surplus = $4,400

Now,

Deadweight Loss is calculated using the formula:

Deadweight loss

= \frac{1}{2} × Tax × (Original equilibrium quantity - New equilibrium quantity)

on substituting the respective values, we get

Deadweight loss = \frac{1}{2} × 4 × (2,000 - 1,700)

or

Deadweight loss =  2 × (3)  = $600

Hence,

the correct answer is option (c) $600

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Answer:

The answer is E. $15 million

Explanation:

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Cash inflow = incoming deposits + revenues from the sale of nondeposit services + customer loan repayments + sale of bank assets + money market borrowings= 30 million + 15 million + 25 million + 5million + 45 million = $120 million

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So, net liquidity position is:  120 million - 105 million = $15 million.

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5 0
3 years ago
A person who can afford a monthly payment of and signs a loan agreement with a monthly payment of is most likely a victim of pre
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Answer:

A. $800; $1100

Explanation:

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2 years ago
People live for four periods. They can choose to work for all four periods, or can attend school in the first period and then wo
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Answer:

People should disregard schooling and  thus work in the entire life period.

Explanation:

Condition 1--- Work throughout the 4 periods

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= 27,272. 7 + 24,793.3 + 22,539.4 +20,490.4

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Condition 2 - Attend school and work later

The NPV = -28,000 + \frac{50,000}{1.1^2} + \frac{50,000}{1.1^3} + \frac{50,000}{1.1^4}

= -28000 + 41,322.31 + 37,565.7 + 34,150.6

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Conclusion: Since the NPV of not going to school is higher, people should disregard schooling. They should work in the entire life period.

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3 years ago
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5 0
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