Question
Please solve using new raw data as you have before per this link: https://www.coursehero.com/tutors-problems/Economics/25523032-2You-have-collected-the-following-data-on-output-and-total-variable-c/ Q TVC ($) 10 72,700 20 123,600 30 156,900 40 176,800
Please solve using new raw data as you have before per this link:
https://www.coursehero.com/tutors-problems/Economics/25523032-2You-have-collected-the-following-data-on-output-and-total-variable-c/
Q TVC ($)
10 72,700
20 123,600
30 156,900
40 176,800
50 187,500
60 193,200
70 198,100
80 206,400
90 222,300
100 250,000
a.Identify the range of output exhibiting increasing returns (increasing MP), and the range exhibiting diminishing returns (decreasing MP).
b.Current fixed costs for the company equal $186,500. Draw two graphs, both with Q on the horizontal axis: one graph shows TVC and TC, and the other shows AVC, AC, and MC.
c.Suppose that the government imposes a $75,000 property tax hike on all businesses; how will that affect your two graphs; i.e., which cost curves will be affected and how?
d.Suppose instead that the government considers your production process to be polluting, and imposes a $350 tax per unit produced (replacing the property tax in the previous question). How does this tax increase compare to the property tax increase, in terms of the effect on your company's cost curves?
e.Your boss says "either of these taxes is going to force us to change our production levels." Given what you know about optimization analysis, how would you respond?
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