Gce Model Questions Vol1 2024 Economics Question 6
Practice objective / multiple choice question 6 from the 2024 Gce Model Questions Vol1 Economics examination.
A market for a good is described by the demand equation \( Q_d = 500 - 5P \) and the supply equation \( Q_s = 3P - 30 \), where \(P\) is the price (in ₦) and \(Q\) is quantity. The government introduces a specific tax of ₦20 per unit on the good, which is levied on producers. (a) Determine the equilibrium price paid by consumers and the equilibrium quantity after the tax. (b) Calculate the total tax revenue and the dead‑weight loss caused by the tax. (c) What is the ratio of tax revenue to dead‑weight loss (expressed as a decimal to two decimal places)?
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About This Question
This is Gce Model Questions Vol1 2024 Economics Question 6. It is one of the objective questions from the 2024 Gce Model Questions Vol1 Economics examination.
Difficulty level: Medium .
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