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Due to the harmful effects on health from over-consumption of sugar, the government would like to discourage consumption of sugar by implementing either (a) an
Due to the harmful effects on health from over-consumption of sugar, the government would like to discourage consumption of sugar by implementing either (a) an effective price floor, or (b) a tax on the suppliers. Analyse the welfare effects of the two measures. Explain your answers with suitable sugar market diagrams
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