Gce Model Questions Vol1 2021 Economics Question 29

Practice objective / multiple choice question 29 from the 2021 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2021 Economics Objective / Multiple Choice Medium Difficulty
Question 29 GCE_MODEL_QUESTIONS_VOL1 • 2021 • ECONOMICS • objective

The government imposes a specific tax of £5 per unit on a good. The demand function is \( Q_{d}=200-3P \) and the pre‑tax supply function is \( Q_{s}= -20 + 2P \).\n\nCalculate:\n(i) the price paid by consumers and the price received by producers after the tax;\n(ii) the tax burden borne by consumers and by producers per unit;\n(iii) the dead‑weight loss (in £).

Answer Options

A. Consumers pay £48, producers receive £40; consumer burden £3, producer burden £2; dead‑weight loss £18
B. Consumers pay £45, producers receive £42; consumer burden £1, producer burden £4; dead‑weight loss £12
Correct Answer C. Consumers pay £46, producers receive £41; consumer burden £2, producer burden £3; dead‑weight loss £15
D. Consumers pay £44, producers receive £43; consumer burden £0, producer burden £5; dead‑weight loss £20
Correct Answer
C
Correct Option:
Consumers pay £46, producers receive £41; consumer burden £2, producer burden £3; dead‑weight loss £15

About This Question

This is Gce Model Questions Vol1 2021 Economics Question 29. It is one of the objective questions from the 2021 Gce Model Questions Vol1 Economics examination.

Difficulty level: Medium .

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