Surplus procedures, Business Economics

Consider a market for a good where there is a per unit tax set at t cents per unit sold, where the demand curve slopes downward and where supply is perfectly inelastic. Suppose the quantity demanded at each price is expected to increase as a result of purchases for a public project.  The size of the change in total market revenue due to the project will be the same as the size of the change in producers' surplus due to the project.

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What is Surplus Procedures?

Posted Date: 2/19/2013 2:09:15 AM | Location : United States







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