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Please be clear with the writing Question 1.5 For simplicity, suppose producers face constant marginal costs. And suppose the government has introduced a resource policy
Please be clear with the writing
Question 1.5 For simplicity, suppose producers face constant marginal costs. And suppose the government has introduced a resource policy that has changed the production cost of the producers. More specifically, because of the policy change, the producer's marginal cost has increased by $10. Suppose the following information has given for estimating the impacts of the policy: Producer's total cost function: TC = 200 + 20q (Hint: the first derivative of TC function with respect to Q is MC=20.) Demand function: q = 100-p What would be the cost of the policy (change in the consumer's surplus)Step by Step Solution
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