A monopoly with a constant marginal cost (m) has a profit-maximizing price of (p_{1}). It faces a

Question:

A monopoly with a constant marginal cost $m$ has a profit-maximizing price of $p_{1}$. It faces a constant elasticity demand curve with elasticity . After the government applies a specific tax of $\$ 1$, its price is $p_{2}$. What is the price change $p_{2}-p_{1}$ in terms of ? How much does the price rise if the demand elasticity is -2 ?

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