[Solved] How Do a Monopoly Lump-Sum Profits Tax and a Monopoly

Question 69
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How do a monopoly lump-sum profits tax and a monopoly sales tax differ in their effects on the monopolist?


A)A profit tax causes the price to rise,whereas the sales tax has no effect on the price.
B)A profit tax causes the output to fall,whereas the sales tax has no effect on the output.
C)A profit tax is totally paid by the monopolist,whereas a sales tax is partially passed on to consumers.
D)A sales tax has no effect on neither the price nor the output.
E)A sales tax has no effect on the monopolist's profit but a profit tax does.

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