The Average Variable Cost Curve Shifts Downward If

question 443

Multiple Choice

The average variable cost curve shifts downward if

• A) there is a decrease in fixed costs.
• B) there is a technological advance.
• C) the cost of a variable input increases.
• D) the price of output decreases.

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Definitions:

Horizontal Equity

The principle that individuals with similar income or resources should be treated equally by the tax system.

Incentives

Refers to stimuli, rewards, or payments that motivate individuals or entities to perform certain actions or behaviors.

Proportional Tax

A tax system where the rate remains constant regardless of the amount to which the tax base is applied.

Progressive Tax

A taxation system where the tax rate increases as the taxable amount or income increases, placing a higher burden on wealthier individuals.