Suppose That You Own Two Farms on Which to Grow

question 12

Multiple Choice

Suppose that you own two farms on which to grow corn. Farm 2 has a lower marginal cost of producing corn than Farm 1. To lower total cost of production, you should produce:

• A) all on Farm 1.
• B) all on Farm 2.
• C) some on Farm 1 and some on Farm 2.
• D) neither on Farm 1 nor on Farm 2.

Analyze how taxes influence the supply and demand of goods and services.

Comprehend the principle of tax neutrality and its implications on economic efficiency.

Calculate the total burden of a tax, including both the tax revenue and the excess burden.

Evaluate different tax bases and their impact on tax efficiency and economic behavior.