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3 years ago

Suppose that a $2 per widget tax is levied on the sellers of widgets. How much revenue is collected from this tax on widgets

Business

1 answer:

JulijaS [17]3 years ago

8 0

Complete Question:

The supply and demand for widgets are given by the following equations: Q = 2,000 - 300P QS = -100 +100P A. where P=price per widget and QD and Qs are the quantities of widgets demanded and supplied. Suppose that a $2 per widget tax is levied on the sellers of widgets. How much revenue is collected from this tax on widgets?

Answer:

The revenue collected from this tax on widgets is

$4,200 (2,100 * $2)

Explanation:

a) Data and Calculations:

The demand for widget = Qd = 2000-300P

The supply for widget = Qs = -100+100P

At equilibrium, the price before tax can be calculated as follows:

Qd = Qs --this is the equilibrium condition

Therefore, 2000-300P = -100+100P

or 2000 + 100 = 300P + 100P

that is 2100 = 400P

or 400P = 2100

Therefore, P = 2100/400

Price per unit = $5.25

The revenue collected from this tax on widgets = $2 * 2,100 = $4,200

b) Since the widget tax is levied on the sellers, it implies that the revenue collected from the widget tax will total $4,200 based on the equilibrium quantity of 2,100 widgets.

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qwelly [4]

Answer:

Sole proprietorship

Explanation:

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3 years ago

A bond with a face value of $100,000 was issued for $93,500 on January 1 of this year. The stated rate of interest was 8 percent

Inessa05 [86]

Answer:

So interest payment will be $8000

Explanation:

We have given face value of the bond = $100000

And bond is issued for $93500

Standard rate of interest = 8 %

And market rate of interest = 10 %

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Interest payment will be given by

Interest payment = face value of bond × standard rate of interest

= $100000×0.08 = $8000

So interest payment will be $8000

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3 years ago

Welch Corporation is planning an investment with the following characteristics (Ignore income taxes.): Useful life 12years Yearl

Vlada [557]

Answer:

$339,600

Explanation:

The internal rate of return is the relationship between the price of the equipment and their yearly cash flow. the IRR makes the net present value equal to zero thus, it makes the present value of the yearly cashflow equal to the cost:

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C 60,000.00

time 12

rate 0.14

$60000 \times \frac{1-(1+0.14)^{-12} }{0.14} = PV\\$

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From the given option:

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3 years ago

Who is responsible for fiscal policy?

TiliK225 [7]

Answer:

C. The federal government controls fiscal policy.

Explanation:

Fiscal policy are policies enacted by the government using its spending or taxes to stabilise the economy. There are two types of fiscal policy, expansionary and contractionary fiscal policy.

1. Expansionary fiscal policy is a policy that increases the money supply in an economy. They include :

A. Reduction of taxes - this increases disposable income and increases consumer spending which increases money supply.

B. Increased government spending- this is when government increases its spending usually on public projects.

2. Contractionary fiscal policy are policies that reduces the money supply in an economy. They include:

A. Increase in taxes- an increased tax reduces disposable income and money supply in an economy.

B. Reduced government spending - reduced government spending reduces money supply.

Monetary policy is policy controlled by the Federal Reserve.

I hope my answer helps you.

3 0

3 years ago

Riverrun Co. provides medical care and insurance benefits to its retirees. In the current year, Riverrun agrees to pay $13,500 f

gtnhenbr [62]

Answer:

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The cost of fringe benefit provided to the employee of the company and any tax component attached to it is known as the employee benefit expense.

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3 years ago