Caleb HvizdakAssignment 3Chapter 151.a. 5%b. No, because the 5% rate of return is less than the 6% interest rate.c. Yes, because the 5% rate of return is greater than the 4% interest rate.d. 2. a. The total cost is $4,000 and the average cost is $0.80 per unit.b. The total cost is still $4,000 but the average cost is $0.67nper unit.c. The firms profit increases by $1,000.d. If the firm only looked at this year, they would turn down the profit because the on-time $1100 cost exceeds the $1000 profit. If the firm looked at 2 or more years they would implement this because they will be earning $1000 every year with a one-time $1100 cost.Chapter 201.10,000=20%20,000=15%30,000=13.33%The tax is regressive because the average tax rate declines as the individual income increases.2.You will pay $13,000 in taxes with a $50,000 income.The marginal tax rate is 40% and the average is 26%. The tax is progressive because the higher the income the higher the tax rates are.