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Unformatted text preview: t per unit. Write down the new cost function for the monopoly and find the new profit-maximizing price and output combination, P ** and Q **, in terms of the parameters a , c and t . (c) How much of the $ t per-unit tax was the monopolist able to pass on to consumers in terms of a higher per-unit price? ( Hint : Take the derivative of the new price P ** with respect to the tax t .)...
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