The demand for portable radios is given by:Q=5000-100P. The local supply curve is given by Q=150P.
a. Find the market equilibrium.
b. Suppose that the government decides to impose a unit tax of $2.00 on the portable radios.Find the new market equilibrium. How will the burden of this tax be allocated between consumers and producers?
c. What will be the change in price that the consumers and the producers have to pay due to the tax?
d. Determine the government revenue and deadweight loss from the taxation