Consider a profit maximising monopolist with linear demand Q(P*) and total production cost C(Q(P*)) who faces a per unit tax t. Suppose the slope of marginal cost is decreasing in some parameter, . Let P* denote the monopolist' profit maximising choice of price. Being careful to explain your method and interpret your result, determine the comparative static:

P*/t

I got to P*= price Q = Q(P*) t=t(Q(P*)) C=C(Q(P*))

max = P*(Q(P*))-C(Q(P*))-t(Q(P*))

d/dP* = Q'(P*)[-C'(Q(P*))-t'(Q(P*))+P*]+Q(P*)=0 d/dP* = + Q'(P*)[-t'(Q(P*))+P*]+Q(P*)

Equilibrum: PQ'(P)=t'(Q(P*))Q(P))--Q(P*)

P* = t'(Q(P*))- /(Q'(P*)) - Q(P*)/Q'(P*)

This is where I got to, when I solved the comparative static partial differentiation I got an answer of 0, I don't believe this is correct, can anyone help me solve this? Thanks!

If 0 is somehow the correct answer, what does it mean?