Consider a market with many buyers and sellers, so that we can use a smooth approximation. Suppose that the marginal valuation (MV) and marginal cost (MC) curves have the following formulas: MV(Q) = 100 - 2Q MC(Q) = 10 + 2Q Assume that a tax of 30 is imposed. You are to find the price the buyer pays (including the tax), the price the seller receives (net of the tax) and the quantities transacted. a) First invert MV(Q) and MC(Q) to find the formulas for the demand and supply curves b) Compute the efficient-equilibrium quantity (net of the tax)

Lipman auto parts, a family-owned auto parts store, began january with $10,300.00 in cash. management forecasts that collections from credit customers will be $11,400.00 in january and $14,800.00 in february. the store is scheduled to receive $5,000.00 in cash on a business note receivable in january. projected cash payments include inventory purchases ($13,000.00 in january and $13,600.00 in february) and operating expenses ($2,700.00 each month). lipman auto parts' bank requires a $10,000.00 minimum balance in the store's checking account. at the end of any month when the account balance dips below $10,000.00, the bank automatically extends credit to the store in multiples of $1,000.00. lipman auto parts borrows as little as possible and pays back loans in quarterly installments of $2,000.00, plus 4 percent interest on the entire unpaid principal. the first payment occurs three months after the loan.