Assume equilibrium. Solve for P and Q P=10000-Q, P=6000 +Q. Then add an excise t

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P = 10,000-Q P= 6000+ Q The first equation is for Quantity demanded and the second is for quantity supplied Qd= 10,000-P Qs= P-6000 In equilibrium, w ehave Qd=Qs 10,000-P= P-6000 16000 = 2P ==> P* = $8,000 Q* = 2,000 An excise tax is imposed. So supply equation will be now Qs= (P-2000)- 6000 [Since now 6000+Qs= P' where P'=P-$2000, as the producer will have to give an excise tax of $2000 and so will essentially get P' which is price after tax) ==> Qs= P-8000 In equilibrium Qd=Qs So, 10,000-P = P - 8000 18000 = 2P 9000 = P Here P is price paid by the consumer which is $9000 Price received by the producer after tax = P-2000 = $(9000-2000)= $7000

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