(Answered) Summer 2006 exam market demand in a constant costs

Management Studies

(Summer 2006 Exam) Market demand in a constant costs perfectly competitive industry isgiven by D = 100 - 5p and each firm has total costs C = q2 + 25. In August the government plans to implement a per-unit tax of $4 in this industry. Provide supplementary calculations and a pair of fully labeled diagrams showing The Typical Firm and Industry Supply and Demand to analyze the impact of this tax.

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