=+c. Now suppose the government introduces a tax t as specified in A(c). Given that I am

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=+c. Now suppose the government introduces a tax t as specified in A(c). Given that I am the one that sells and you are the one that buys x1

, how can you now rewrite our demand functions to account for t? (Hint: There are two ways of doing this: either define p as the pre-tax price and let the relevant price for the buyer be 1p 1 t2 or let p be defined as the post-tax price and let the relevant price for the seller be 1p 2 t2.)

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