Assume a market subject to the following functions: Qs = 3P + 40 and Qd = -6P + 480.
If the government places a $5 per-unit tax in the market, mathematically determine the market price and quantity before and after the tax, the amount of the tax (per unit) that producers must absorb and the amount of tax passed on to consumers (per unit), the amount of tax revenue generated by the government, and the dead weight loss to society. Based on these calculations, is the overall relative elasticity of demand in this market elastic, inelastic, or unitary and how can you tell.