ECON 4070 Midterm: ECON 4070 York Fall 06 Midterm
Document Summary
As/econ 4070 3. 0af midterm exam wednesday october 25 2006 time = 50 minutes. All questions count equally: what would be the incidence of a per unit excise tax on a product which is pro- vided in a perfectly competitive market, for which the demand curve has the equation. Qd = 120 5p d and for which the supply curve had the equation. State as precisely as possible the assumptions that you are making. continued over. 1: the picture above shows the e ects of a tax on clothing, when the price of food is , and when the net of tax price of clothing is . Point a, at (900, 900) is the consumption bundle which the person would choose if there were no tax. Point b at (1600, 400) is on the same indi erence curve as a, but is located where the slope of the indi erence curve is 1/2.
