Suppose the tax on liquor is increased so that the tax goes from being a "medium" tax to being a "large" tax.As a result,it is likely that

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When the tax on liquor is increased, it becomes a "large" tax which could discourage consumers from buying liquor leading to a decrease in tax revenue. Additionally, the increase in tax would also increase the deadweight loss because it would create a larger gap between the price paid by the consumer and the price received by the producer. Therefore, tax revenue decreases, and the deadweight loss increases.

Suppose the Tax on Liquor Is Increased So That the Tax