Suppose that a firm has to pay a 10 tax on revenue. The ...

[SGallaher96]

Suppose that a firm has to pay a 10 tax on revenue. The profit-maximizing level of output is
 a. unaffected by the tax.
  b. increased because of the tax.
  c. decreased because of the tax.

Question 2

Suppose that a firm has to pay a 10 tax on its total revenue. This has the effect of
 a. flattening marginal cost.
  b. increasing marginal revenue.
  c. decreasing marginal cost.
  d. decreasing marginal revenue.

[Dnite]

Answer to Question 1

c

Answer to Question 2

d