Homework Help: Economics

Posted by Andrea on Monday, February 4, 2013 at 11:24am.

There are 10 identical consumers whose demand is D: p = 20 - 10q. There are 10 identical firms, each firm's marginal cost is MC(q)= 5 + 5q. The market is competitive.

a) derive the market demand function
b) derive the market supply function
c) what is the market equilibrium quantity and price?

An excise tax of $3 per unit is imposed on firms (you may introduce Pc and Pf where consumers face the price Pc and firms face the price Pf)

d) analyze the tax incidence. That is, how is the $3 excise tax divided between the firm and the consumers?

for part a) would I just multiple the demand function given D: p=20 -10q by 10?

thanks in advance for your help.

No one has answered this question yet.

Answer this Question

Related Questions

economics - The hand made snuffbox industry is composed of 100 identical firms, ...
economics - 5. A market contains a group of identical price-taking firms. Each ...
economics - suppose a competitive market consists of identical firms with a ...
managerial economicsQ3 - Suppose the inverse market demand equation is P = 80 &...
Economics - Two identical firms compete as a Cournot duopoly. The demand they ...
economics - perfectly competitive industry. Each firm having identical cost ...
economics - This is going to be really long, but I want to see if my answers are...
managerial economicsQ4 - Consider a Cournot duopoly, composed of firms A & B...
Economics - A long-run supply curve is flatter than a short-run supply curve ...
Biology - What is the probability that any two humans with the same parents will...

For Further Reading

First Name:
School Subject:
Answer: