4. Suppose the market for grass seed can be expressed

4. Suppose the market for grass seed can be expressed as:

Demand: Q^d = 200 – 5P

Supply: Q^s = 40 + 5P

If the government collects a $5 specific tax from sellers (here you can change the supply equation to Q^s = 40 + 5(P-t) or Q^s = 15+ 5P,

1. How much will the quantity demanded change from the amount demanded before the tax?
2. What price will consumers pay after the tax?
3. What price will sellers receive after the tax?
4. What is the consumer surplus before tax
5. What is the consumer surplus after tax
6. What is the tax revenue?

. Suppose the market for corn is given by the following equations for supply and demand:                                                                Q^s = 3p − 2

Q^d = 10 − P

where Q is the quantity in millions of bushels per year and p is the price.

a.Calculate the equilibrium price and quantity. Sketch the supply and demand curves on a graph indicating the equilibrium.

b.   If a price floor is imposed at $5 per bushel, will there be a surplus or a shortage? What is the quantity of excess supply or demand that results? Draw a graph to show this.