Question 1

The total output produced with any quantity of labour is equal to the sum of the

Accepted Answer

A) average products of each of the workers hired. 
B) marginal costs of each of the workers hired. 
C) marginal products of each of the workers hired. 
D) average costs of each of the workers hired. 
E) fixed products of each of the workers hired. 
A) average products of each of the workers hired. 
B) marginal costs of each of the workers hired. 
C) marginal products of each of the workers hired. 
D) average costs of each of the workers hired. 
E) fixed products of each of the workers hired.

Question 2

Normal profit is the ________.Normal profit ________ part of a firm's opportunity cost.

Accepted Answer

A) return that an entrepreneur can expect to receive on average;is 
B) profit used by the Canada Revenue Agency to calculate tax owing;is 
C) profit used by the Canada Revenue Agency to calculate tax owing;is not 
D) return that an entrepreneur can expect to receive on average;is not 
E) difference between total revenue and total cost;is 
A) return that an entrepreneur can expect to receive on average;is 
B) profit used by the Canada Revenue Agency to calculate tax owing;is 
C) profit used by the Canada Revenue Agency to calculate tax owing;is not 
D) return that an entrepreneur can expect to receive on average;is not 
E) difference between total revenue and total cost;is

Question 3

Use the figure below to answer the following questions.   Figure 10.3.2
-Refer to Figure 10.3.2,which illustrates the short-run average and marginal cost curves.The average variable cost curve is curve

Accepted Answer

A) A. 
B) B. 
C) C. 
D) D. 
E) C minus curve B 
A) A. 
B) B. 
C) C. 
D) D. 
E) C minus curve B

Question 4

Marginal product

Accepted Answer

A) is always negative. 
B) equals the slope of the total product curve. 
C) is always zero. 
D) lies between zero and one. 
E) equals average product minus total product. 
A) is always negative. 
B) equals the slope of the total product curve. 
C) is always zero. 
D) lies between zero and one. 
E) equals average product minus total product.

Question 5

Choose the correct equation.

Accepted Answer

A) TFC = TC/Q 
B) TFC = TC - AVC 
C) TFC = TC - TVC 
D) TFC = TVC/Q 
E) TFC = TVC - TC 
A) TFC = TC/Q 
B) TFC = TC - AVC 
C) TFC = TC - TVC 
D) TFC = TVC/Q 
E) TFC = TVC - TC

Question 6

Marginal product of labour is the increase in total product that results from a

Accepted Answer

A) one-unit increase in the quantity of labour employed,other inputs remaining the same. 
B) one-unit increase in the quantity of fixed inputs employed,holding the quantity of labour constant. 
C) $1 increase in the cost of labour. 
D) change in the total cost of labour. 
E) one-unit increase in the minimum efficient scale. 
A) one-unit increase in the quantity of labour employed,other inputs remaining the same. 
B) one-unit increase in the quantity of fixed inputs employed,holding the quantity of labour constant. 
C) $1 increase in the cost of labour. 
D) change in the total cost of labour. 
E) one-unit increase in the minimum efficient scale.

Question 7

If the marginal product of the fifth worker is 34,then the total product of five workers

Accepted Answer

A) is 35. 
B) is 24. 
C) is 170. 
D) is 6.8. 
E) cannot be calculated with the information given. 
A) is 35. 
B) is 24. 
C) is 170. 
D) is 6.8. 
E) cannot be calculated with the information given.

Question 8

When the marginal product of labour is greater than the average product of labour,

Accepted Answer

A) the average product of labour is increasing. 
B) the marginal product of labour is increasing. 
C) the total product curve is negatively sloped. 
D) the firm is experiencing diminishing marginal returns. 
E) the firm is experiencing constant returns. 
A) the average product of labour is increasing. 
B) the marginal product of labour is increasing. 
C) the total product curve is negatively sloped. 
D) the firm is experiencing diminishing marginal returns. 
E) the firm is experiencing constant returns.

Question 9

If the ATC curve is rising then the MC curve must be

Accepted Answer

A) horizontal. 
B) falling. 
C) intersecting ATC. 
D) above ATC. 
E) below ATC. 
A) horizontal. 
B) falling. 
C) intersecting ATC. 
D) above ATC. 
E) below ATC.

Question 10

Which of the following are correct? According to the law of diminishing returns, (1)marginal product eventually rises.
(2)marginal product eventually falls.
(3)marginal cost eventually rises.
(4)marginal cost eventually falls.

Accepted Answer

A) (1)and (3) 
B) (1)and (4) 
C) (2)and (3) 
D) (2)and (4) 
E) (4) 
A) (1)and (3) 
B) (1)and (4) 
C) (2)and (3) 
D) (2)and (4) 
E) (4)

Question 11

Use the figure below to answer the following questions.   Figure 10.3.2
-Refer to Figure 10.3.2,which illustrates short-run average and marginal cost curves.Which one of the following statements is false?

Accepted Answer

A) Average fixed cost decreases with output. 
B) The vertical gap between curves B and C is equal to average variable cost. 
C) Line B comes closer to line C as output increases because of a decrease in average fixed cost. 
D) Curve D is the marginal cost curve. 
E) The vertical gap between curves B and C is equal to average fixed cost. 
A) Average fixed cost decreases with output. 
B) The vertical gap between curves B and C is equal to average variable cost. 
C) Line B comes closer to line C as output increases because of a decrease in average fixed cost. 
D) Curve D is the marginal cost curve. 
E) The vertical gap between curves B and C is equal to average fixed cost.

Question 12

If diseconomies of scale are present,

Accepted Answer

A) average total cost is decreasing. 
B) the long-run average cost curve has a negative slope. 
C) economies of scale are also present. 
D) the long-run average cost curve has a positive slope. 
E) the average total cost curve shifts downward. 
A) average total cost is decreasing. 
B) the long-run average cost curve has a negative slope. 
C) economies of scale are also present. 
D) the long-run average cost curve has a positive slope. 
E) the average total cost curve shifts downward.

Question 13

As soon as diminishing returns set in,a firm's

Accepted Answer

A) marginal product increases. 
B) average fixed cost decreases. 
C) marginal cost decreases. 
D) marginal cost increases. 
E) total cost decreases. 
A) marginal product increases. 
B) average fixed cost decreases. 
C) marginal cost decreases. 
D) marginal cost increases. 
E) total cost decreases.

Question 14

If an increase in output from 5 to 10 teapots increases total cost from $100 to $200,the marginal cost of one of those 5 teapots is

Accepted Answer

A) $10. 
B) $20. 
C) $22. 
D) $25. 
E) dependent upon the amount of extra labour used. 
A) $10. 
B) $20. 
C) $22. 
D) $25. 
E) dependent upon the amount of extra labour used.

Question 15

Use the table below to answer the following questions.
Table 10.2.2  
-Refer to Table 10.2.2 which gives Rob's Repair Shop's total product schedule.The average product when Rob's employs four workers is

Accepted Answer

A) 2 repairs per worker. 
B) 8 repairs per worker. 
C) 12 repairs per worker. 
D) 15 repairs per worker. 
E) 3.75 repairs per worker. 
A) 2 repairs per worker. 
B) 8 repairs per worker. 
C) 12 repairs per worker. 
D) 15 repairs per worker. 
E) 3.75 repairs per worker.

Question 16

The vertical distance between the TC and TVC curves

Accepted Answer

A) decreases as output increases. 
B) increases as output increases. 
C) is equal to AFC. 
D) is equal to TFC. 
E) is equal to MC. 
A) decreases as output increases. 
B) increases as output increases. 
C) is equal to AFC. 
D) is equal to TFC. 
E) is equal to MC.

Question 17

Suppose a firm increases the quantity of labour employed from 5 to 6 workers,and as a result,the firm's total output increases from 100 units to 400 units.The marginal product of the sixth worker is

Accepted Answer

A) 150 units. 
B) 100 units. 
C) 400 units. 
D) 300 units. 
E) 66.67 units. 
A) 150 units. 
B) 100 units. 
C) 400 units. 
D) 300 units. 
E) 66.67 units.

Question 18

Gerald is a freelance writer who could work for a newspaper at $25,000 a year but instead runs his own business making revenue of $40,000 a year.His only business expenses are $1,000 for writing materials and $12,000 for rent.What is Gerald's economic profit from working as a freelance writer?

Accepted Answer

A) $2,000 
B) $28,000 
C) $15,000 
D) $25,000 
E) $27,000 
A) $2,000 
B) $28,000 
C) $15,000 
D) $25,000 
E) $27,000

Question 19

At that amount of output where diminishing marginal returns first sets in,

Accepted Answer

A) average product begins to decrease. 
B) total product begins to decrease. 
C) marginal cost begins to decrease. 
D) marginal product begins to decrease. 
E) average product is at its maximum. 
A) average product begins to decrease. 
B) total product begins to decrease. 
C) marginal cost begins to decrease. 
D) marginal product begins to decrease. 
E) average product is at its maximum.

Question 20

Refer to the table below to answer the following questions.
Table 10.2.1
  
-Refer to Table 10.2.1 which gives Tania's Teapots' total product schedule.The average product when Tania's hires two workers is

Accepted Answer

A) 3 teapots per worker. 
B) 6 teapots per worker. 
C) 7 teapots per worker. 
D) 9 teapots per worker. 
E) 12 teapots per worker. 
A) 3 teapots per worker. 
B) 6 teapots per worker. 
C) 7 teapots per worker. 
D) 9 teapots per worker. 
E) 12 teapots per worker.

The total output produced with any quantity of labour is equal to the sum of the

Normal profit is the .Normal profit part of a firm's opportunity cost.

Use the figure below to answer the following questions. Figure 10.3.2 -Refer to Figure 10.3.2,which illustrates the short-run average and marginal cost curves.The average variable cost curve is curve

Marginal product

Choose the correct equation.

Marginal product of labour is the increase in total product that results from a

If the marginal product of the fifth worker is 34,then the total product of five workers

When the marginal product of labour is greater than the average product of labour,

If the ATC curve is rising then the MC curve must be

Which of the following are correct? According to the law of diminishing returns, (1)marginal product eventually rises. (2)marginal product eventually falls. (3)marginal cost eventually rises. (4)marginal cost eventually falls.

Use the figure below to answer the following questions. Figure 10.3.2 -Refer to Figure 10.3.2,which illustrates short-run average and marginal cost curves.Which one of the following statements is false?

If diseconomies of scale are present,

As soon as diminishing returns set in,a firm's

If an increase in output from 5 to 10 teapots increases total cost from $100 to $200,the marginal cost of one of those 5 teapots is

Use the table below to answer the following questions. Table 10.2.2 -Refer to Table 10.2.2 which gives Rob's Repair Shop's total product schedule.The average product when Rob's employs four workers is

The vertical distance between the TC and TVC curves

Suppose a firm increases the quantity of labour employed from 5 to 6 workers,and as a result,the firm's total output increases from 100 units to 400 units.The marginal product of the sixth worker is

Gerald is a freelance writer who could work for a newspaper at $25,000 a year but instead runs his own business making revenue of $40,000 a year.His only business expenses are $1,000 for writing materials and $12,000 for rent.What is Gerald's economic profit from working as a freelance writer?

At that amount of output where diminishing marginal returns first sets in,

Refer to the table below to answer the following questions. Table 10.2.1 -Refer to Table 10.2.1 which gives Tania's Teapots' total product schedule.The average product when Tania's hires two workers is

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Exam 10: Output and Costs

The total output produced with any quantity of labour is equal to the sum of the

Normal profit is the ________.Normal profit ________ part of a firm's opportunity cost.

Use the figure below to answer the following questions. Figure 10.3.2 -Refer to Figure 10.3.2,which illustrates the short-run average and marginal cost curves.The average variable cost curve is curve

Marginal product

Choose the correct equation.

Marginal product of labour is the increase in total product that results from a

If the marginal product of the fifth worker is 34,then the total product of five workers

When the marginal product of labour is greater than the average product of labour,

If the ATC curve is rising then the MC curve must be

Which of the following are correct? According to the law of diminishing returns, (1)marginal product eventually rises. (2)marginal product eventually falls. (3)marginal cost eventually rises. (4)marginal cost eventually falls.

Use the figure below to answer the following questions. Figure 10.3.2 -Refer to Figure 10.3.2,which illustrates short-run average and marginal cost curves.Which one of the following statements is false?

If diseconomies of scale are present,

As soon as diminishing returns set in,a firm's

If an increase in output from 5 to 10 teapots increases total cost from $100 to $200,the marginal cost of one of those 5 teapots is

Use the table below to answer the following questions. Table 10.2.2 -Refer to Table 10.2.2 which gives Rob's Repair Shop's total product schedule.The average product when Rob's employs four workers is

The vertical distance between the TC and TVC curves

Suppose a firm increases the quantity of labour employed from 5 to 6 workers,and as a result,the firm's total output increases from 100 units to 400 units.The marginal product of the sixth worker is

Gerald is a freelance writer who could work for a newspaper at $25,000 a year but instead runs his own business making revenue of $40,000 a year.His only business expenses are $1,000 for writing materials and $12,000 for rent.What is Gerald's economic profit from working as a freelance writer?

At that amount of output where diminishing marginal returns first sets in,

Refer to the table below to answer the following questions. Table 10.2.1 -Refer to Table 10.2.1 which gives Tania's Teapots' total product schedule.The average product when Tania's hires two workers is

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, preferences, and Choices

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Filters

Normal profit is the .Normal profit part of a firm's opportunity cost.