Question

Hello, I had already solve this questions with the best of my knowdlege. Please let me know if they are correct. Thanks.

3. Under what circumstances does the burden of an excise tax fall mainly on producers? when the supply is relatively inelastic and demand is fairly elastic b. when the supply is relatively elastic and demand is fairly inelastic c. when consumers do not have many substitutes for the good d. when it is easy for suppliers to expand production of the good 4. If penalties are imposed only on the buyers of illegal drugs, the equilibrium price of illegal drugs will _and the equilibrium quantity will __ a Rise; decrease b. Rise; increase c. Fall; increase d. Fall; decrease 5. Among the implicit costs of a firm are all of the following except A the owner's forgone wage costs of resources bought in markets, such as labor c. normal profits d. foregone rent 6. The short run is a time frame in which @ at least one factor of production is fixed b. all factors of production can be varied c. all factors of production are fixed d. at least one factor of production can be varied 7. Diminishing marginal returns occur when the average product of the variable input eventually diminishes ( the marginal product of an additional worker is less than the marginal product of the previous worker hired c. the firm hires cheap, less-skilled workers in place of expensive, high-skilled workers d. total product diminishes

Answer 1

Ans 3) yes it is correct

Ans 4) yes you are correct as when the penalties are imposed the demand of Durga may fall which will lead to increase in price and decrease in quantity equilibrium

Ans 5) yes the correct answer is normal profit as implicit cost basically refers to cost foregone if the owner doesn't carry on business or work .

Ans6) yes it's correct again ,, in short run time frame atleast one factor of production is fixed rest can vary

Ans 7) yes it's correct .. in diminishing return start when total product increases at an decreasing rate , i.e marginal product is less than the previous marginal product

Ans 8) labour TP. MP

0. 0. 0

1. 5. 5

2. 9. 4

3. 12. 3

4. 14. 2

5. 15. 1

Yes the correct answer is 3 pizzas ...as MP³ = TP³-TP²

Ans 9 ) yes you are right ..according to law of varibale proportion AP intersects MP when AP is maximum

Ans 10) the correct answer is 400 as total fixed cost remains same i.e 200 but total variable cost will be 200 as 2 labour produces 50 output as each labour is paid 100 .so TC = TFC + TVc

TC = 200 +200

Ans is 400