Suppose the market for cigarettes can be described as follows:<\/p>
Qs<\/sup>= P<\/p> Qd<\/sup>= 60-P<\/p> where Qs<\/sup>and Qd<\/sup>are, respectively, quantity supplied and quantity demanded (in appropriate units) and P denotes price (in dollars per carton of cigarettes). Suppose the government wants to discourage smoking. In an attempt to do so, it wants to tax the suppliers in a way to bring the price of a carton of cigarettes to $40. Using matrix algebra, find the per unit tax that will achieve this goal. Discuss the incidence of the tax.<\/p>",
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