Exam 11: Behind the Supply Curve: Inputs and Costs

Buffalo Aircraft doubles the amount of all of the inputs it uses-the factory doubles in size and twice as many workers are hired.After this expansion,the number of aircraft produced triples.If the price of inputs is unchanged,this means that Buffalo Aircraft is operating with:

Use the following to answer question: -(Figure: Marginal Product of Labor)Use Figure: The Marginal Product of Labor.The total product for three workers is _____ bushels.

When long-run average total cost is constant as output increases,the firm has constant returns to scale.

When a firm produces a small amount of output,the spreading effect:

Average variable cost is:

Use the following to answer question: -(Table: Cost Data)Use Table: Cost Data.The average fixed cost of producing 2 purses is:

The change in total output resulting from a one-unit increase in the quantity of an input used,holding the quantities of all other inputs constant,is:

If the marginal cost of producing the seventh sports jersey is $21,then the total cost of seven sports jerseys is:

Use the following to answer question: -(Table: Output and Costs)Use Table: Output and Costs.When output is 4,total variable cost equals:

The slope of a long-run average total cost curve exhibiting decreasing returns to scale is:

Use the following to answer question: -(Figure and Table: Variable,Fixed,and Total Costs)Use Figure and Table: Variable,Fixed,and Total Costs.When 96 bushels of wheat is produced,the average fixed cost is _____,average variable cost is _____,and average total cost is _____.

When an increase in the firm's output reduces its long-run average total cost,it has _____ returns to scale.

A firm always operates at some point on its long-run average total cost curve in both the long run and the short run.

Use the following to answer question: -(Figure: Short-Run Costs)Use Figure: Short-Run Costs.A is the _____ cost curve.

Krista's dry-cleaning business incurs $900 per month in fixed costs.Last month her total output was 3,000 pounds of clothes.This month her total output fell to 2,700 pounds.This means her average fixed cost _____ by a little more than _____ cents.

Ashley Bakery expects its marginal cost curve will eventually slope upward because,as with most production processes,baking has:

The curve that illustrates the relationship between output and average total cost when the fixed cost has been chosen to minimize average total cost for each level of output is the _____ curve.

Marginal cost is the change in _____ cost resulting from a one-unit change in _____.

When Aishe's Bar-B-Que produces 10 pork sandwiches,the total cost is $5.When 11 pork sandwiches are produced,the total cost rises to $6.From this we know that the marginal cost of the eleventh pork sandwich:

When an increase in the firm's output reduces its long-run average total cost,it achieves _____ scale.