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Per-unit taxes increase the marginal cost of production, which can lead to a reduction in output.
Implementing per-unit taxes guarantees that all producers will reduce their output to the socially efficient level.
Per-unit taxes can help internalize negative externalities by aligning marginal private costs with marginal social costs.
If per-unit taxes are set too high, they could lead to market distortions and decreased overall welfare.
Per-unit taxes do not affect consumer prices or demand for the taxed goods.
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Understanding Per-Unit Taxes
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