The above figure shows the cost curves for a competitive firm. If the market price is $15 per unit, the firm will earn profits of

Suppose that a monopolist must choose between two points on its demand curve: it can sell 100 units for $3 each, or it can sell 150 units for $2 each. Which of the following is true?

a. The monopolist is facing elastic demand. b. The monopolist is facing unit elastic demand. c. The monopolist is facing inelastic demand. d. The monopolist is facing perfectly elastic demand. e. The elasticity of demand cannot be determined with the information given.

Suppose the government taxes 25 percent of the first $60,000 of income and 40 percent of all income above $60,000 . For a person earning $200,000 . the marginal tax rate is

a. 25 percent, and the average tax rate is 32.5 percent. b. 25 percent, and the average tax rate is 36 percent. c. 40 percent, and the average tax rate is 32.5 percent. d. 40 percent, and the average tax rate is 36 percent.