1)Show that for a monopolist with a constant marginal cost and facing a linear demand curve, if...
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Question:
1)Show that for a monopolist with a constant marginal cost and facing a linear demand curve, if a specific tax is imposed on the monopolist, the tax burden is shared equally between the monopolist and the consumers.
2)What is the advantage of the government imposing an ad valorem tax over a specific tax when facing a monopoly?
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