The demand function for merino ewes is D(p)=100/p and supply function is S(p)=p.
What is the equilibrium price?
What is the equilibrium quantity?
An ad valorem tax of 300 percent is imposed on merino ewes so that the price paid by demanders is four times the price received by suppliers. What is the equilibrium price paid by the demanders for merino ewes now? What is the equilibrium price received by the suppliers for merino ewes? What is the equilibrum quantity?