A local video rental monopolist faces the weekly demand function D (P) = 1,000 - 50P. The

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A local video rental monopolist faces the weekly demand function D (P) = 1,000 - 50P. The marginal cost of a rental is $1. Suppose the town government places a $1 tax on all video rentals. What effect will the tax have on the price the monopolist charges? What (dollar) share of the tax do consumers bear?
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Microeconomics

ISBN: 978-1118572276

5th edition

Authors: David Besanko, Ronald Braeutigam

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