The demand for microwaves in a small town is given by P(Q) =…
The demand for microwaves in a small town is given by P(Q) = 80 – 3Q. Suppose Steve’s Surplus Store is the sole supplier of microwaves in this small town, and this firm has a constant marginal (and average) cost of $8. What is the deadweight loss created in this market, if any?
Read DetailsThe inverse demand function for cigarettes is given by P(q)…
The inverse demand function for cigarettes is given by P(q) = 90 – 2q where q is the quantity of packs of cigarettes that are sold. The inverse supply function is given by P(q) = 10 + 3q. In the past, cigarettes were not taxed, but now a tax of $15 per pack has been introduced. Which of the following functions represent the market supply functions adjusted for the presence of the tax?
Read Details