Why does a monopolist prefer a specific tax to an ad valorem tax?

adb34 Posts: 1, Reputation: 1

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Mar 8, 2016, 09:20 AM

Why does a monopolist prefer a specific tax to an ad valorem tax?

Qn: "A monopolist prefers an ad valorem tax to a specific tax, other things equal." True of False?

I know a monopolist prefers specific tax because ad valorem takes a larger portion of their revenue, but I'm not sure how to explain it.

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