Tax Rate, Tax Revenues, and Equilibrium Quantity of Capital

1. In an economy, the supply curve of labour, S, is given by: S = -100 + 200W_n
Where W_n is the after-tax wage rate. Assume that the before-tax wage rate is fixed at 10.

a) Write a formula for tax revenues as a function of the tax rate, and sketch the function in a diagram with the tax rate, and sketch the function in a diagram with the tax rate on the horizontal axis and tax revenues on the vertical axis. (Hint: Note that W0 = (1 - t) 10, where t is the tax rate, and that tax revenues are the product of hours worked, the gross wage, and the tax rate.) Suppose that the government currently imposes a tax rate of 70 percent. Whast advice would you give?

b) Try this problem if you know some calculus: At what tax rate are tax revenues maximized in this economy?

2. Assume Canada is a small open economy such that the supply of capital is perfectly elastic at a net rate of return equal to 10 percent. Suppose the demand for capital in Canada is a downward sloping function of the net-of-tax rate of return (r_t) and economic depreciation. Depict the equilibrium quantity of capital in Canada and the user cost of capital (C) in the case where

a) There is no corporate taxation in Canada
b) There is corporate tax in Canada and the marginal investment is financed by the equity
c) There is a corporate tax in Canada and the marginal investment is financed by debt

Use the following supply and demand functions to answer the questions below:
Qd = 20-2P, Qs = 5+3P
a. Determine the equilibrium price andquantityand illustrate with a graph.
b. The government imposes a tax of $5.00. Find the new equilibrium price andquantity.
c. Determine the total tax revenue earned by the governme

Use the graph below that shows the effect of a $4 per-unit
tax on suppliers to answer the following questions:
a. What are equilibrium price andquantity before the
tax? After the tax?
b. What is producer surplus when the market is in
equilibrium before the tax? After the tax?
c. What is consumer surplus when the market is

Let supply be given by P=5Q and demand by P=19-2Q.
A) What would be the equilibriumquantityandequilibrium price?
B) Suppose the Government imposes a $5 per unit tax on the seller, which equation would be affected and how?
C) What would be the new equilibriumquantityand price?

1) Suppose that a market is described by the following supply and demand equations:
Qs= 2P
Qd= 300-P
a. Solve for equilibrium price and the equilibriumquantity.
b. Suppose that a tax of T is placed on buyers, so the new demand equation is
Qd= 300- ( P+T)
Solve for the new equilibrium. What h

Use supply and demand analysis to explain why the equilibrium price of apples will rise and the equilibriumquantity will fall if an excise tax is levied on apples. Explain why the price of apples will not rise by the full amount of the tax.

The long-run supply curve for a particular type of kitchen knife is horizontal line at a price of $3 per knife. The demand curve for such a kitchen knife is
QD = 50-2P
Where QD is the quantity of knives demanded (in millions per year) and P is the price per knife (in dollars).
a. What is the equilibrium output of such k

Q11. Discuss the current tax treatment of capital gains under the personal income tax. Why do some economists argue that reduction in the rate of taxation andcapital gains can actually increase tax revenue collected from such gains?

1. Suppose the demand is Q = 10 - P and the supply is Q = P + 4. Please verify that the following table gives the quantity demanded and supplied at each given prices. What is the equilibrium price andquantity sold under perfect competition?
Price QuantityQuantity
Supplied Demanded
1 5 9
1.5 5.5 8.5
2 6 8
2.5 6.5 7.5

Dear OTA: Please help me complete this task. These are the questions I need answered but I sent an attachment through to that explains what I ultimately need done. Thank you so much!!!!
? Identify and describe the effect of changing the tax rate on disposable income and consumption, as well as the post-tax multiplier. You