Taxation Practice Problems

This website automatically generates ad valorem problems. There is no limit to how many problems you can try. Press the "Refresh" button on your browser to generate a new problem. Website designed by my student Alex Gan.

Problem:

Original Demand: P = 948 + (-9 Q)

Original Supply: P = 360 + 9 Q

An ad valorem tax of 47% is on supply.





























































Answer:

After-tax Demand: P = 948 + (-9 Q)

After-tax Supply: P = 679.24528301887 + 16.981132075472 Q

Market price: P = 654

Market quantity: Q = 32.666666666667

Taxed price: P = 854.90196078431

Taxed quantity: Q = 10.344226579521

Total tax consumer pay: 2078.1754026229

Total tax producer pay: 2078.1754026229

Dead weight loss: DWL = 4484.621982998