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The government decides to tax cookbooks because they feel that they encourage overeating and can lead to health issues, such as obesity and heart disease. Answer the following:

· What type of tax is this? describe.

· What happens to the supply of cookbooks?

· What happens to the equilibrium price?

· Who pays the tax at the end?

· Is this a good way to finance programs to improve health?

· What other types of tax can the government use to increase revenues?

Basic Finance, Finance

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