(e) If per unit tax of 2 is added. MC and ATC will vertically shift
upward of 2. Hence this firm will suffer a loss and in the long run,
there are some suppliers exiting this market, causing supply curve to
the Left.
The new equilibrium price will be higher but when you use P= MR= MC to
decide on the single firm's output, the quantity produced will remain
the same in that MC and ATC is uplifting vertically of 2 units.
