The Student Room Group

Question on effect of tax

Q: https://imgur.com/a/LKy9K

Solution: https://imgur.com/a/Frxsx

Hi,

For part c I'd like to know why carrying out FOC and SOC can show the effect of tax on the price and quantity in the US market. This is not do with marginal product so I am a bit lost...
Thank you
Reply 1
So the effect of the tax is shown by the signs of the number ? As in if the FOC is positive then this shows an increase whereas if SOC is negative then a decreasing effect is shown? Thanks

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