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Poor old Charlie. Suppose he has u = xy and an income of 120 to allocate between these goods. Prices are pX= 1 and pY=
Poor old Charlie. Suppose he has u = xy and an income of 120 to allocate between these goods. Prices are pX= 1 and pY= 2. Next month the government will introduce a tax of 3 dollars per unit of x. The approximate change in Charlie's consumer surplus is equal to _______and the exact change in his consumer surplus is equal to __________. No diagram is required.
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