Lecture Exercise #9Spring 2022You will work on these exercises during class on Wednesday, February 2nd. You are strongly encouraged to work with 3 or 4 of your peers, where you will discuss and work through the problems together. The instructional team will circulate between groups to answer your questions and provide guidance. Post your answers on Poll Everywhere (PE) using the link provided by Professor Balaban. Note that the PE link will be opened on command during class and will close with 15-20 minutes left in class. A warning will be given a few minutes before the link is closed. We will review the answers after the link isclosed.Honor Code Notice: You are not permitted to upload any content from this course to the web in any form, including but not limited to Chegg, Course Hero, Coursera, Google Drive, etc. If you post my coursecontent, you may be violating my intellectual property rights. In utilizing web sources to upload or download course content, you risk violating the University’s Honor Code.1. If the demand for oranges is more elastic than the supply of oranges, then the burden of a tax on oranges willa. fall mainly on suppliers.b. be split evenly between suppliers and buyers.c. falls completely on supplier.d. fall mainly on buyers.The graph below represents the market for a large supreme pizza. The vertical distance between points A and B represents a per-unit tax that has been imposed in this market. Use this information to answers question 2-4.2. What is the value of the per-unit tax?a. $14b. $16c. $24d. $83. What is the per-unit price paid by consumers for a large supreme pizzas after the tax is imposed?a. $24b. $16c. $24DSBA70 100101624quantitypriced. $104. How much of the per-unit tax burden will fall on the buyers of large supreme pizzas?a. $24b. $10c. $8d. $6This graph represents the market for a six-pack of cola. Use the graph to answer questions 5-6.5. If the government wants to reduce the consumption of cola to 2 six-packs, then it shoulda. Impose a tax of $3 per six-pack.b. Impose a tax of $5 per six-pack.c. Impose a subsidy of $3 per six-pack.d. Impose a subsidy of $5 per six-pack.6. Suppose the government imposes a tax so that the consumption of cola is reduced to 2 six-packs. Is there a deadweight loss in the market?a. No, there is not a deadweight loss.b. Yes, there is a deadweight loss due to unrealized gains from trade.c. Yes, there is a deadweight loss due to wasted resources.7. Suppose a tax is placed on a good in a market where supply is perfectly inelastic. Although the price elasticity of demand is unknown, we do know that demand is not perfectly inelastic nor perfectly elastic. Which of the following statements is true?a. There is no deadweight loss in the market and the seller will bear the entire burden of the tax.b. There is no deadweight loss in the market and the buyer will bear the entire burden of the tax.c. There is a deadweight loss in the market and the seller will bear the entire burden of thetax.d. There is a deadweight loss in the market and the buyer will bear the entire burden of the
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