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A3) Consider a perfectly competitive market. The industry demand curve is QD = 7-2P. The industry supply curve is Q5 = P. Suppose the government

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A3) Consider a perfectly competitive market. The industry demand curve is QD = 7-2P. The industry supply curve is Q5 = P. Suppose the government introduces a subsidy s=1 per unit sold. Which of the following is wrong? 0 Consumers pay less per unit 0 Deadweight loss increases 0 Producers are paid more per unit 0 More quantity is traded in the market None of the above

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