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The finding that the average real price of abortions has remained relatively constant over the last twenty-five years suggests that the long run supply curve
The finding that the average real price of abortions has remained relatively constant over the last twenty-five years suggests that the long run supply curve is horizontal. In 1997, Medoff estimated that the price elasticity of demand for abortions is near -0.80. Suppose the federal government imposed a lump sum tax on abortion clinics that would raise their minimum average cost by 12.5%, what would happen to the market price of abortions, to the number of abortions and to the number of abortion clinics. Would the tax affect urban and rural women in the same way? Discuss and use a figure to illustrate your arguments
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