The demand for gizmos is given by Q=2,000-100P and the supply of gizmos is given by...

The demand for gizmos is given by Q=2,000-100P and the supply of gizmos is given by Q=-100 + 200P. There is a $2/unit sales tax on gizmos. Who pays the tax? Who bears the economic burden of the tax? On a supply and demand graph, label the price that buyers pay, the price sellers receive, the tax incidence borne by buyers and sellers, and the deadweight loss associated with the tax.

Expert Solution

Rahul Sunny answered 2 years ago

The demand for rutabagas is Q = 2,000 − 300P and the supply of rutabagas is...

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