Profit maximization depends upon demand conditions, as well as upon productivity and costs

Which of the following scenarios is consistent with the Laffer curve?

a. The tax rate is 1 percent, and tax revenue is very low. b. The tax rate is 1 percent, and tax revenue is very high. c. The tax rate is 99 percent, and tax revenue is very high. d. The tax rate is moderate (between very high and very low), and tax revenue is very low.

A firm with two plants, A and B, has the following estimated demand and marginal cost functions:Qd = 120 - 10PMCA = 4  + (1 / 5)QAMCB = 6 + (1 / 10)QBHow should the firm allocate total output between the two plants in order to maximize profit?

A. produce 20 units in plant A, 20 units in plant B B. produce 5 units in plant A, 10 units in plant B C. produce 15 units in plant A, 10 units in plant B D. produce 20 units in plant A, 25 units in plant B E. none of the above