Neco 2022 Economics Question 41
Practice objective / multiple choice question 41 from the 2022 Neco Economics examination.
The market for a good is described by demand \( P = 100 - 2Q \) and supply \( P = 20 + Q \), where \( P \) is price (₦) and \( Q \) is quantity (units). The government imposes a specific tax of \( t \) per unit, shifting the supply curve upward by \( t \). The government wants to raise exactly ₦360 in tax revenue.\n\n(i) Determine the value of \( t \) (to two decimal places) that will achieve this revenue, choosing the smaller possible tax.\n\n(ii) Using this tax, calculate the percentage decrease in consumer surplus compared with the original equilibrium, rounded to the nearest whole percent.
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About This Question
This is Neco 2022 Economics Question 41. It is one of the objective questions from the 2022 Neco Economics examination.
Difficulty level: Medium .
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