Suppose the market for soda is represented by the supply and demand equations:
Q^S = 35P - 39.75 and Q^D = 10.25 - 5P, where P is price per bottle and Q measures bottles per second.
a. What are the values of consumer and producer surplus?
b. If the government imposes a $0.50 tax per bottle, what are the values of consumer and producer surplus?
c. What is the deadweight loss from the tax? How much revenue does the tax yield?

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The Answer of Suppose the market for soda is represented by the supply and demand equations: Q^S = 35P - 39.75 and Q^D = 10.25 - 5P, where P is price per bottle and Q measures bottles per second. a. What are the values of consumer and producer surplus? b. If the government imposes a $0.50 tax per bottle, what are the values of consumer and producer surplus? c. What is the deadweight loss from the tax? How much revenue does the tax yield?

Suppose the Market for Soda Is Represented by the Supply