How is it possible for marginal cost to equal to the slope of either the total variable cost function or the total cost function?
What will be an ideal response?
The reason is that the total cost function is simply shifted up by the amount of total fixed costs from total variable costs. Since the slopes of both functions are the same it doesn't matter which one is used to calculate marginal cost.
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The supply of sand is perfectly inelastic and the demand curve for sand is downward sloping. Hence, if a tax on sand is imposed,
A) sand buyers pay the entire tax. B) sand sellers pay the entire tax. C) the tax is split evenly between the buyers and sellers. D) the government pays the entire tax. E) the government collects no tax revenue because the supply is perfectly inelastic.
Which of the following shifts the demand for loanable funds curve leftward?
A) a fall in the real interest rate B) a rise in the real interest rate C) a decrease in the taxes paid by the business D) a decrease in the expected profit