Solution

Here is the algebraic solution; the graphs are omitted. The general relationships used are as follows:

Buyer's decision rule: `WTP = P^d`

Seller's decision rule: `WTA = P^s`

Equilibrium condition: `Q^d = Q^s`

Accounting identity: `P^d = P^s + T`

Part 1

`T = 0`

`P^d = P^s + T`

`10 - Q^d/20 = Q^s/5 + 0`

`10 = Q^s/4`

`Q^s = 40 = Q^d`

`P^d = WTP = 10 - 40/20 = 8`

Check: `P^s = WTA = 40/5 = 8`

Part 2

`T = 5`

`P^d = P^s + T`

`10 - Q^d/20 = Q^s/5 + 5`

`5 = Q^s/4`

`Q^s = 20 = Q^d`

`P^d = WTP = 10 - 20/20 = 9`

`P^s = WTA = 20/5 = 4`

Check: `9 = 4 + 5`

`Rev = 5*20 = 100`

Part 3

`\Delta CS = -30`

`\Delta PS = -120`

`\Delta SS = -50` or `DWL = $50`

`{DWL}/{Rev} = {$50}/{$100} = 50%`