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Business, 17.07.2020 21:01 ashleybarrera2000

Consider a market with many buyers and sellers, so that we can use a smooth approximation. Suppose that the marginal valuation (MV) and marginal cost (MC) curves have the following formulas: MV(Q) = 100 - 2Q MC(Q) = 10 + 2Q Assume that a tax of 30 is imposed. You are to find the price the buyer pays (including the tax), the price the seller receives (net of the tax) and the quantities transacted. a) First invert MV(Q) and MC(Q) to find the formulas for the demand and supply curves b) Compute the efficient-equilibrium quantity (net of the tax)

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