Currently doing an assignment where we have to implement government policy to fix market failures. In my paper I'm doing the market for alcohol, which means that the MSB<MPB. The government policy I want to implement as a solution is a systembolaget style market monopolisation, but I don't know how to show this on a MC/MB model. Is this possible? Would I use the model for a monopoly where MC=MSC and AR=MPB?
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