Question: A monopoly is facing a demand curve given by Q=ap - , >1. The monopoly's unit production cost is c>0. Suppose now that the government

A monopoly is facing a demand curve given by Q=ap^-, >1. The monopoly's unit production cost is c>0. Suppose now that the government imposes a tax of t dollars per unit on each unit of output sold to consumers.

What is the increase in price caused by the tax?
What is the relationship between demand elasticity and the price increase?

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