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Consider the market for gasoline illustrated in the figure. Suppose the market is perfectly competitive and initially 6.00 in equilibrium. 5.50 with tax Now suppose

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Consider the market for gasoline illustrated in the figure. Suppose the market is perfectly competitive and initially 6.00 in equilibrium. 5.50 with tax Now suppose the government imposes a gasoline tax of 5.00- $2.00 to be paid for by producers. 4.50- Show how the tax affects the market for gasoline. 4.00- 3.50- Use the line drawing tool to add either a new supply or demand curve. Properly label this line. 3.00 2.50- Carefully follow the instructions above, and only draw the 2.00- required object. 1.50- 1.00- How much government revenue does the gasoline tax 0.50- generate? $ 5.00 (Enter your response rounded to two 0.00- decimal places.) 0 10 20 30 40 50 60 70 80 90 100 111 Quantity of gasoline

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