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- Calculate the equation based on the following given assumption
• Demand is given by the equation: Qd = 200 – P
• Supply is given by the equation: Qs = 100 + P
• A competitive equilibrium exists
a. Determine the equilibrium price and quantity of housing, given the above information.
b. Assume a tax on housing of 10 units ($10,000 if you like) is introduced. Determine the new quantity of housing exchanged and the new price received by producers.
c. Determine the deadweight loss that results from this tax.
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