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(a) Suppose a government is considering to choose a market to give a. per-unit subsidy based on estimates of price elasticity of demand and supply.
(a) Suppose a government is considering to choose a market to give a. per-unit subsidy based on estimates of price elasticity of demand and supply. They;r want to deliver it to a. market Where the deadweight loss would be smallest. Assume all markets have the same presubsid}r equilibrium price and quantity. Evaluate 1Whether the following statement is ne, False or Uncertain, and explain by using a diagram/s. [9] It is better to choose a. market where the demand curve is relatively inelastic than. the supply curve
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