Assume the Following Total Cost Schedule for a Perfectly Competitive

question 7

Multiple Choice

Assume the following total cost schedule for a perfectly competitive firm. $$\begin{array}{l}\begin{array} { | l | l | l | } \hline \text { Output } & \text { TVC } & \text { TFC } \\\hline 0 & 0 & 100 \\\hline 1 & 40 & 100 \\\hline 2 & 70 & 100 \\\hline 3 & 120 & 100 \\\hline 4 & 180 & 100 \\\hline 5 & 250 & 100 \\\hline 6 & 330 & 100 \\\hline\end{array}\\\text { TABLE 9- } 2\end{array}$$
-Refer to Table 9- 2. In order to maximize its profits, the firm should continue to produce in the short run even if the market price is less than its ATC as long as the price is greater than or equal to

• A) MC.
• B) AVC.
• C) TC
• D) TVC.
• E) AFC.

Grasp the impact of elasticity on the incidence of excise taxes.

Understand the principles of tax progressivity, regressivity, and proportionality.

Understand the various sources of government revenue.

Analyze the impact of elasticities on tax efficiency and tax burden distribution.

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