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

Refer to Scenario 7.2 below to answer the question(s) that follow. SCENARIO 7.2: You are the owner and only employee of a company that sets odds for sporting events. Last year you earned a total revenue of $100,000. Your costs for rent and supplies were $50,000. To start this business you invested an amount of your own capital that could pay you a return of $20,000 a year. -Refer to Scenario 7.2. A yearly normal return for your company is

Refer to the information provided in Figure 7.4 below to answer the question(s) that follow. Figure 7.4 -Refer to Figure 7.4. The marginal product of the fourth worker is

At the Larson Bakery the marginal products of the first, second, and third sales clerks are 20, 17, and 11 customers served, respectively. The total product (number of customers served) of the three sales clerks is

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 firmʹs isocost line could shift from CE to CD if

Assume the total product of two workers is 130 and the total product of three workers is 150. The average product of three workers is ________, and the marginal product of the third worker is ________.

An economist is studying the pricing behavior of Las Vegas all-you-can-eat buffets. He says he will limit his analysis to a time period that allows for new buffets to enter the market and for existing ones to leave it. The economist is referring to the ________ time period.

Refer to the information provided in Figure 7.4 below to answer the question(s) that follow. Figure 7.4 -Refer to Figure 7.4. The average product with three workers is