Answer:
a. A reduction in business property taxes. Fixed cost.
Marginal cost curve = No change
Average variable cost curve = No change
Average-fixed-cost curve = Shift down
Average-total-cost curve = Shift down
b. An increase in the nominal wages of production workers is a Variable cost.
Marginal cost curve = Shift up
Average variable cost curve = Shift up
Average-fixed-cost curve = No change
Average-total-cost curve = Shift up
c. A decrease in the price of electricity (Variable cost)
Marginal cost curve = Shift down
Average variable cost curve = Shift down
Average-fixed-cost curve = No change
Average-total-cost curve = Shift down
d. An increase in insurance rates on plant and equipment. (Fixed cost)
Marginal cost curve = No change
Average variable cost curve = No change
Average-fixed-cost curve = Shift up
Average-total-cost curve = Shift up
e. An increase in transportation costs. (Variable cost)
Marginal cost curve = Shift up
Average variable cost curve = Shift up
Average-fixed-cost curve = No change
Average-total-cost curve = Shift up
Explanation:
