Question 1

The marginal product of labour initially ________ and eventually ________.The average product of labour initially ________ and eventually ________.

Accepted Answer

A) increases;decreases;increases;decreases 
B) decreases;increases;decreases;increases 
C) increases;decreases;decreases;increases 
D) decreases;increases;increases;decreases 
E) increases;is constant;increases;decreases 
A) increases;decreases;increases;decreases 
B) decreases;increases;decreases;increases 
C) increases;decreases;decreases;increases 
D) decreases;increases;increases;decreases 
E) increases;is constant;increases;decreases

Question 2

Use the table below to answer the following questions.
Table 11.2.2
  
-Refer to Table 11.2.2 which gives Tania's total product schedule.The average product when the firm hires three workers is

Accepted Answer

A) 1 teapot per worker. 
B) 2 teapots per worker. 
C) 3 teapots per worker. 
D) 4 teapots per worker. 
E) 12 teapots per worker. 
A) 1 teapot per worker. 
B) 2 teapots per worker. 
C) 3 teapots per worker. 
D) 4 teapots per worker. 
E) 12 teapots per worker.

Question 3

When the demand for electricity peaks during the hottest days of summer,Hydro One can generate more electricity by using more fuel and increasing the working hours of many of its employees.The company cannot,however,increase electric power production by building additional generating capacity.This means that the company is operating in the

Accepted Answer

A) market run. 
B) intermediate run. 
C) long run. 
D) immediate run. 
E) short run. 
A) market run. 
B) intermediate run. 
C) long run. 
D) immediate run. 
E) short run.

Question 4

Use the table below to answer the following questions.
Table 11.3.1
  
-Refer to Table 11.3.1,which gives Tania's total cost schedule.The average total cost of producing 16 teapots per day is

Accepted Answer

A) $2. 
B) $5. 
C) $3.33. 
D) $7.50. 
E) $5.51. 
A) $2. 
B) $5. 
C) $3.33. 
D) $7.50. 
E) $5.51.

Question 5

Use the table below to answer the following questions.
Table 11.3.1
  
-Refer to Table 11.3.1,which gives Tania's total cost schedule.When output increases from 4 to 9 teapots,the marginal cost of one of the 5 teapots is

Accepted Answer

A) $4.25. 
B) $4. 
C) $25. 
D) $6.25. 
E) $5. 
A) $4.25. 
B) $4. 
C) $25. 
D) $6.25. 
E) $5.

Question 6

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 7

Use the table below to answer the following questions.
Table 11.2.2
  
-Refer to Table 11.2.2 which gives Tania's total product schedule.The average product when the firm employs four workers is

Accepted Answer

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

Question 8

The average fixed cost curve slopes downward due to

Accepted Answer

A) diminishing marginal utility. 
B) diminishing marginal returns. 
C) technological inefficiency. 
D) economic inefficiency. 
E) none of the above. 
A) diminishing marginal utility. 
B) diminishing marginal returns. 
C) technological inefficiency. 
D) economic inefficiency. 
E) none of the above.

Question 9

A technological advance will shift
(1)TP,AP,and MP curves up.
(2)TP,AP,and MP down.
(3)TC,ATC,and MC curves up.
(4)TC,ATC,and MC curves down.

Accepted Answer

A) (1)and (3) 
B) (1)and (4) 
C) (2)and (3) 
D) (2)and (4) 
E) none of the above 
A) (1)and (3) 
B) (1)and (4) 
C) (2)and (3) 
D) (2)and (4) 
E) none of the above

Question 10

Average variable cost is at a minimum at the same output at which

Accepted Answer

A) average product is at a maximum. 
B) average product is at a minimum. 
C) marginal product is at a maximum. 
D) marginal product is at a minimum. 
E) marginal cost is at a minimum. 
A) average product is at a maximum. 
B) average product is at a minimum. 
C) marginal product is at a maximum. 
D) marginal product is at a minimum. 
E) marginal cost is at a minimum.

Question 11

When Coffee 'n' Cream in Victoria,British Columbia hires two students,64 customers can be served in one hour.Suppose the manager of the restaurant observes that after hiring the third student,80 customers are being served in one hour.The marginal product of the third student is ________ customers per hour.

Accepted Answer

A) 4 
B) 16 
C) 8 
D) 26.67 
E) 32 
A) 4 
B) 16 
C) 8 
D) 26.67 
E) 32

Question 12

Marginal product

Accepted Answer

A) is always negative. 
B) is 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) is 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 13

Choose the correct statement.

Accepted Answer

A) When marginal product of labour is greater than average product of labour and marginal product is either increasing or decreasing average product of labour is increasing. 
B) When total product is increasing average product of labour and marginal product of labour are both increasing. 
C) When marginal product of labour is greater than or equal to average product of labour, average product of labour is increasing. 
D) When marginal product of labour is increasing, average product of labour is greater than marginal product of labour. 
E) When total product is increasing, average product of labour is decreasing and marginal product of labour is increasing. 
A) When marginal product of labour is greater than average product of labour and marginal product is either increasing or decreasing average product of labour is increasing. 
B) When total product is increasing average product of labour and marginal product of labour are both increasing. 
C) When marginal product of labour is greater than or equal to average product of labour, average product of labour is increasing. 
D) When marginal product of labour is increasing, average product of labour is greater than marginal product of labour. 
E) When total product is increasing, average product of labour is decreasing and marginal product of labour is increasing.

Question 14

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) None of the above. 
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) None of the above.

Question 15

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 the variable inputs constant. 
C) one-unit increase in both the quantity of variable and fixed inputs. 
D) change in the cost of labour. 
E) 1 percent change in the quantity of labour and the quantity of capital employed. 
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 the variable inputs constant. 
C) one-unit increase in both the quantity of variable and fixed inputs. 
D) change in the cost of labour. 
E) 1 percent change in the quantity of labour and the quantity of capital employed.

Question 16

Diseconomies of scale refer to the range of output over which

Accepted Answer

A) long-run average cost rises as output increases. 
B) average cost exceeds marginal cost. 
C) long-run average cost falls as output increases. 
D) the marginal product of labour increases. 
E) marginal product equals average product. 
A) long-run average cost rises as output increases. 
B) average cost exceeds marginal cost. 
C) long-run average cost falls as output increases. 
D) the marginal product of labour increases. 
E) marginal product equals average product.

Question 17

Use the figure below to answer the following question.
   
Figure 11.2.2
-Refer to Figure 11.2.2 which shows Tania's average product curve and marginal product curve.The point of maximum average product is point

Accepted Answer

A) B. 
B) C. 
C) D. 
D) E. 
E) F. 
A) B. 
B) C. 
C) D. 
D) E. 
E) F.

Question 18

A firm's total product curve describes

Accepted Answer

A) the minimum cost of producing a given amount of output. 
B) the maximum output that a given quantity of labour can produce. 
C) how the maximum attainable output varies as the size of the firm's plant varies, given the quantity of labour employed. 
D) how the management of the firm makes decisions over the short run. 
E) how the amount of labour varies as the amount of output varies. 
A) the minimum cost of producing a given amount of output. 
B) the maximum output that a given quantity of labour can produce. 
C) how the maximum attainable output varies as the size of the firm's plant varies, given the quantity of labour employed. 
D) how the management of the firm makes decisions over the short run. 
E) how the amount of labour varies as the amount of output varies.

Question 19

Use the figure below to answer the following questions.
   
Figure 11.4.4
-Refer to Figure 11.4.4,which illustrates the long-run average total cost curve.Given an increase in output from Q? to Q?,

Accepted Answer

A) economies of scale exist. 
B) diseconomies of scale exist. 
C) constant returns to scale exist. 
D) average total cost is increasing. 
E) average total cost is decreasing. 
A) economies of scale exist. 
B) diseconomies of scale exist. 
C) constant returns to scale exist. 
D) average total cost is increasing. 
E) average total cost is decreasing.

Question 20

Use the figure below to answer the following question.
   
Figure 11.3.1
-Refer to Figure 11.3.1.Which one of the following statements is false?

Accepted Answer

A) The total fixed cost curve A. 
B) Total variable cost and total cost both increase with output. 
C) The vertical gap between curves B and C is equal to total variable cost. 
D) Marginal cost is equal to the slope of curve C. 
E) Total fixed cost is constant. 
A) The total fixed cost curve A. 
B) Total variable cost and total cost both increase with output. 
C) The vertical gap between curves B and C is equal to total variable cost. 
D) Marginal cost is equal to the slope of curve C. 
E) Total fixed cost is constant.

Exam 11: Output and Costs

The marginal product of labour initially ________ and eventually ________.The average product of labour initially ________ and eventually ________.

Use the table below to answer the following questions. Table 11.2.2 -Refer to Table 11.2.2 which gives Tania's total product schedule.The average product when the firm hires three workers is

Use the table below to answer the following questions. Table 11.3.1 -Refer to Table 11.3.1,which gives Tania's total cost schedule.The average total cost of producing 16 teapots per day is

Use the table below to answer the following questions. Table 11.3.1 -Refer to Table 11.3.1,which gives Tania's total cost schedule.When output increases from 4 to 9 teapots,the marginal cost of one of the 5 teapots is

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

Use the table below to answer the following questions. Table 11.2.2 -Refer to Table 11.2.2 which gives Tania's total product schedule.The average product when the firm employs four workers is

The average fixed cost curve slopes downward due to

A technological advance will shift (1)TP,AP,and MP curves up. (2)TP,AP,and MP down. (3)TC,ATC,and MC curves up. (4)TC,ATC,and MC curves down.

Average variable cost is at a minimum at the same output at which

Marginal product

Choose the correct statement.

If diseconomies of scale are present

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

Diseconomies of scale refer to the range of output over which

Use the figure below to answer the following question. Figure 11.2.2 -Refer to Figure 11.2.2 which shows Tania's average product curve and marginal product curve.The point of maximum average product is point

A firm's total product curve describes

Use the figure below to answer the following questions. Figure 11.4.4 -Refer to Figure 11.4.4,which illustrates the long-run average total cost curve.Given an increase in output from Q? to Q?,

Use the figure below to answer the following question. Figure 11.3.1 -Refer to Figure 11.3.1.Which one of the following statements is false?

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

Organizing Production

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Externalities

Public Goods and Common Resources

Markets for Factors of Production

Economic Inequality

Measuring GDP and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: The Keynesian Model

Canadian Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

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The marginal product of labour initially and eventually .The average product of labour initially and eventually .