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Consider the market of rice as a perfectly competitive market. The diagram below shows the market in equilibrium. Suppose the Government is considering the imposition
Consider the market of rice as a perfectly competitive market. The diagram below shows the market in equilibrium. Suppose the Government is considering the imposition of specific tax of $2 per kg on rice. Illustrate, identify and explain all the changes in the economic welfare due to the imposition of the tax.
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