33:390:310 Lecture Notes - Lecture 3: Autarky, Focus Group, Arc Elasticity
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Directions: the homework will be collected in a box before the lecture. Please place your name, ta name and section number on top of the homework. Make sure you write your name as it appears on your id so that you can receive the correct grade. Please remember the section number for the section for which you are registered, because you will need that number when you submit exams and homework. Late homework will not be accepted so make plans ahead of time to insure that your homework is submitted. Your homework reflects you: please make sure that you submit a neat, organized, and legible set of answers! Also remember that calculators are not permitted on the exam, so you should try these manually. Part i: excise tax: consider the ice cream market in madison. In equilibrium, we know that the quantity demanded = quantity supplied. Use the point elasticity formula to compute these two values of these elasticities.
