Suppose the government currently raises $100 million through a 1-cent tax on widgets, and another $100 million

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Suppose the government currently raises $100 million through a 1-cent tax on widgets, and another $100 million through a 10-cent tax on gadgets. If the government doubled the tax rate on widgets and eliminated the tax on gadgets, would it raise more tax revenue than it does today, less tax revenue, or the same amount? Explain.

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Principles of economics

ISBN: 978-0538453042

6th Edition

Authors: N. Gregory Mankiw

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