If a competitive firm has to pay a lump sum tax, it will produce less
Indicate whether the statement is true or false
False. A lump sum tax is not related to the amount of output produced. It will increase fixed cost and thus lower profit. However, marginal cost will not be affected, and the profit-maximizing quantity will stay the same.
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The figure above shows that the value of the resources used in job-search activity can be as large as ________ per hour
A) $12,000 B) $8,000 C) $6,000 D) $4,000 E) $2,000
The market price for wallets is $20 . Your technology is such that at your most efficient production point, the average total cost of producing a wallet is $2.50 . Your manager runs into your office and shouts, "Boss! Average costs are rising! Average costs are rising!" To make a profit-maximizing decision, you should
a. definitely decrease production b. immediately stop production c. completely ignore your manager d. ask the manager about the marginal cost e. ask the manager about the average total cost
Why does the AVC reach its minimum before the ATC reaches its minimum?
What will be an ideal response?
Given the same cost data, a pure monopolist producer will charge:
A. a higher price and produce a larger output than a purely competitive industry. B. a lower price and produce a smaller output than a purely competitive industry. C. a higher price and produce a smaller output than a purely competitive industry. D. the same price and produce the same output as a purely competitive industry.