Consider the demand curve P = 100-2Q. The supply curve is given by P = 30.
(a) Draw the supply and demand curves to scale and compute the equilibrium price and quantity in this market.
(b) If the government imposes a tax of $10 per unit, draw the new equilibrium and compute the new quantity traded and the amount of tax revenue generated.
(c) Is demand elastic or inelastic in this price range?