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Please show your work and make sure that your answers are correct Janet consumes two types of food, blueberry scones and quinoa salad. At the
Please show your work and make sure that your answers are correct
Janet consumes two types of food, blueberry scones and quinoa salad. At the current price of $2 per scone, Janet buys 200 scones per year. Worried about increasing diabetes, the state governor imposes a $0.25 sales tax on scones (and on all other sweet bakery and pastry products). To avoid losing the votes of pastry consumers like Janet, who feel impoverished by the new tax, the governor also mails a $50 check to each state resident (including Janet). a) Will Janet be worse off after the governor implements this new policy? b) Suppose Janet has standard convex preferences. Will she consume more, fewer or the same amount of scones after the policy is implemented? What about quinoa saladStep by Step Solution
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