Consider a monopolist with constant marginal costs, m, that faces a market demand curve with a constant own-price elasticity . I.e., P(Q)= Q^1/

In the unregulated market, the monopolist has a profit-maximizing price ofp₁. After the government applies a specific tax of $1.00on the monopolist, the profit maximizing price isp₂.

What is the price change,p₂ - p₁, in terms of?

a.) p₂ - p₁ = ? (Properly format your expression)

b.) Suppose the constant own-price elasticity of market demand is 5.Then the$1.00 specific tax will increase the monopolist's profit-maximizing price by $ ? (Round to two decimal places.)