Answer the following questions regarding taxes.
a. Suppose the demand for insulin pumps is Q^D = 2,000 and the supply of insulin pumps is Q^S = 0.5P - 1,000. What is the price that sellers receive per pump? Suppose the government imposes a tax of $400 per pump on sellers. What after-tax price per pump do sellers receive?
b. In the market for organic fruit, the elasticity of supply is 0.75 and the elasticity of demand is -1.25. If there is a tax of $2 per unit on organic fruit, what share of the tax is paid by buyers and what share is paid by sellers?

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The Answer of Answer the following questions regarding taxes. a. Suppose the demand for insulin pumps is Q^D = 2,000 and the supply of insulin pumps is Q^S = 0.5P - 1,000. What is the price that sellers receive per pump? Suppose the government imposes a tax of $400 per pump on sellers. What after-tax price per pump do sellers receive? b. In the market for organic fruit, the elasticity of supply is 0.75 and the elasticity of demand is -1.25. If there is a tax of $2 per unit on organic fruit, what share of the tax is paid by buyers and what share is paid by sellers?

Answer the Following Questions Regarding Taxes