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A Monopolist demand function is P = 30 - 0.75Q and his AC takes the form AC- 30/Q = 9 + 0.3Q. Find the level of output which gives the maximum profit.

i. When government imposes a lump sum tax of 10
ii. When a tax of 8.4 % of quantity produced is imposed on the Monopolist
iii. When a subsidy of 4.2% of quantity produced is paid to the Monopolist

Microeconomics, Economics

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