Question: Draw a graph showing the marginal revenue (MR) and marginal cost (MC) of increasing the tax rate (t) in the Peltzman model of regulation represented

Draw a graph showing the marginal revenue (MR) and marginal cost (MC) of increasing the tax rate (t) in the Peltzman model of regulation represented by equation (19.1). Place the tax rate on the horizontal axis and MR and MC on the vertical axis. Show the optimum tax rate.

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