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Refer to the Information Provided in Table 19 -Refer to Table 19

Question 110

Multiple Choice

Refer to the information provided in Table 19.5 below to answer the questions that follow.
Capital and labor each cost $1 per unit. The firm produces 1,000 units of output.
Table 19.5
 Input  Requirements  per unit of  Output  Technology KL A 52 B 35\begin{array} { | c | c c | } & \begin{array} { c } \text { Input } \\\text { Requirements } \\\text { per unit of } \\\text { Output }\end{array} \\\text { Technology } & K& L \\\hline \text { A } & 5 & 2 \\\hline \text { B } & 3 & 5 \\\hline\end{array}
-Refer to Table 19.5. Suppose the government imposes a 100% tax on capital. What is the total burden of the tax? Assume that the industry is perfectly competitive and thus price is equal to the marginal cost of production.


A) $1,000
B) $3,000
C) $4,000
D) $11,000

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