Exam 7: The Production Process: the Behavior of Profit-Maximizing Firms

Refer to the information provided in Figure 7.8 below to answer the question(s) that follow. Figure 7.8 -Refer to Figure 7.8 The firm's isocost line could shift from CD to AB if

A firm has no fixed factors of production in

Refer to the information provided in Figure 7.10 below to answer the question(s) that follow. Figure 7.10 -Refer to Figure 7.10. At Point A the absolute value of the slope of the q¹ = 100 isoquant is

A production function shows the greatest amount that a firm will produce given the amount of labor input.

Refer to Scenario 7.6 below to answer the question(s) that follow. SCENARIO 7.6: Upon graduating with an accounting degree, you open your own accounting firm of which you and your assistant are the only employees. To start the firm you passed on a job offer with a large accounting firm that offered you a salary of $50,000 annually. Last year you earned a total revenue of $120,000. Rent and supplies last year were $50,000. Your assistant's salary is $30,000 annually. -Refer to Scenario 7.6. Your annual economic profit is

Average product of labor is calculated as

Assume the total product of three workers is 120 and the total product of four workers is 160. The average product of four workers is ________, and the marginal product of the fourth worker is ________.

A firm is operating such that the marginal product of labor is 10 and the marginal product of capital is 20. The firm is minimizing its costs only if

The quantitative relationship between inputs and outputs is called

Assume that capital and labor are complementary inputs. If the firm decreases the amount of capital it employs, this would

The equation (MP_L/P_L) = (MP_K/P_K) represents

Refer to the information provided in Figure 7.9 below to answer the question(s) that follow. Figure 7.9 -Refer to Figure 7.9. The firm is currently along isocost CD. If the price of capital is $30, then the price of labor is

If we assume that labor is the only variable input, the slope of the short-run ________ curve measures the marginal product of labor.