Exam 7: Production Inputs and Cost Building Blocks for Supply Analysis

Which of the following experiments will yield observations that would allow one to calculate the marginal physical product of labor?

Figure 7-8 -Of the graphs in Figure 7-8, which represents total cost?

In the short run, a firm has fixed costs but never any variable costs.

Table 7-5 -Table 7-5 shows short-run total cost figures for a stereo manufacturer.At what output level does short-run average total cost reach a minimum?

Where marginal cost is less than average cost,

Economies of scale are also called increasing returns to scale.

Table 7-1 -The marginal physical product of an input is the

The "law" of diminishing returns asserts that marginal returns will ultimately diminish when the quantity of one input is increased.

When economies of scale are present,

In the long run, more costs become fixed.

Figure 7-8 -Of the graphs in Figure 7-8, which resembles marginal cost?

Which of the following indicates an input is being overused relative to the optimal level?

The marginal cost curve shows the per-unit cost associated with various levels of output.

Which of the following is the correct statement of the marginal rule for optimal input proportions? The input proportion is optimal when

At a given level of wheat output, one more unit of labor would produce 10 extra bushels, and one more unit of seed would produce 30 extra bushels.A unit of labor costs $6, and a unit of seed costs $12.The farmer should

Fixed cost increases when output rises.

On Naomi's pig farm, Naomi hires all the labor used, grows all the grain fed to the pigs, and owns the barn.The costs used to calculate the total cost curve include

Al's Donuts produces about 600 dozen doughnuts daily.If flour prices increase 20 percent

Table 7-1 -In Table 7-1, the average physical product after five workers are hired is

Production indifference curves show the combination of inputs that produce a given output.