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5: Assume that instead of taxing the meat consumption, the Government puts a tax of 10$ per kilo of pork meat sold. a)Graphically show the
5: Assume that instead of taxing the meat consumption, the Government puts a tax of 10$ per kilo of pork meat sold.
a)Graphically show the effect of the consumption tax on the equilibrium price and quantity.
b)Compute the price paid by consumers PD, the price received by producers PS, and the quantity traded QT, after the Government's tax has been instituted.
c)Discuss the welfare implication of the tax.
d)Explain who bears most of the tax burden, the consumers or the suppliers? Why?
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