Senator Beatrice is concerned that one of the state’s major industries, food processing, is hampered by a high rate of taxation applied to capital. She has introduced legislation which would provide a substantial tax reduction for capital used in the food processing industry, while leaving capital taxation unchanged in the rest of the economy. Set up a diagram like Figure 13.9 in which you can analyze the effect of a reduction in the rate of taxation on capital in the food processing sector and explain the effects of the tax reduction.