bette's breakfast, a perfectly competitive eatery, sells its "breakfast special" (the only item on the menu) for $5.00. the costs of waiters, cooks, power, food, etc. average out to $3.95 per meal; the costs of the lease, insurance, and other such expenses average out to $1.25 per meal. bette should a. lower her output. b. close her doors immediately. c. raise her prices above the perfectly competitive level. d. continue producing in the short run, but plan to go out of business in the long run.

9. tax types: taxes are classified based on whether they are applied directly to income, called direct taxes, or to some other measurable performance characteristic of the firm, called indirect taxes. identify each of the following as a “direct tax,” an “indirect tax,” or something else: a. corporate income tax paid by a japanese subsidiary on its operating income b. royalties paid to saudi arabia for oil extracted and shipped to world markets c. interest received by a u.s. parent on bank deposits held in london d. interest received by a u.s. parent on a loan to a subsidiary in mexico e. principal repayment received by u.s. parent from belgium on a loan to a wholly owned subsidiary in belgium f. excise tax paid on cigarettes manufactured and sold within the united states g. property taxes paid on the corporate headquarters building in seattle h. a direct contribution to the international committee of the red cross for refugee relief i. deferred income tax, shown as a deduction on the u.s. parent’s consolidated income tax j. withholding taxes withheld by germany on dividends paid to a united kingdom parent corporation