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Category > Business & Finance Posted 29 Apr 2017 My Price 2.00

Suppose all firms in a perfectly competitive market structure are in long-run equilibrium

Suppose all firms in a perfectly competitive market structure are in long-run equilibrium. Then demand for the firms’ product increases. Initially, price and economic profits rise. Soon afterward, the government decides to tax most (but not all) of the economic profits, arguing that the firms in the industry did not earn them – the profits were simply the result of an increase in demand. What effect, if any, will the tax have on market adjustment?

Mar 28 2016 03:16 AM

 

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Status NEW Posted 29 Apr 2017 09:04 AM My Price 2.00

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file 1493457919-Answer.docx preview (102 words )
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