Refer to the following: \[\begin{array} { c c c c } \begin{array} { c } \text { Units } \\ \text { of Labor } \end{array} & \begin{array} { c } \text { Totel } \\ \text { Praduet } \end{array} & \begin{array} { c } \text { Average } \\ \text { Product } \end{array} & \begin{array} { c } \text { Narginal } \\ \text { Produet } \end{array} \\ \hline 1 & - & - & 100 \\ 2 & - & 125 & - \\ 3 & 300 & - & - \\ 4 & - & - & 20\\ 5&290&-&- \end{array}\] -In the table above, diminishing returns

A) begin with the first unit of labor. B) begin with the third unit of labor. C) begin with the fourth unit of labor. D) begin with the fifth unit of labor. E) do not occur because output is positive for all levels of labor usage. A) begin with the first unit of labor. B) begin with the third unit of labor. C) begin with the fourth unit of labor. D) begin with the fifth unit of labor. E) do not occur because output is positive for all levels of labor usage. B

Refer to the following: The amount of total output produced from various combinations of labor and capital. \[\begin{array}{l} \text { Units of Capital }\\ \begin{array} { c c c c c c } & & 1 & 2 & 3 & 4 \\ \hline \text { Units } & 1 & 20 & 36 & 48 & 53 \\ \text { of } & 2 & 38 & 68 & 88 & 94 \\ \text { Iabor } & 3 & 53 & 94 & 122 & 133 \\ & 4& 63 & 112 & 148 & 164 \\ & 5 & 68 & 120 & 164 & 184 \end{array} \end{array}\] -Which of the following input combinations can produce the same level of output?

A) 4K, 2L and 3K, 2L B) 3K, 2L and 2K, 3L C) 2K, 3L and 4K, 2L D) all of the above A) 4K, 2L and 3K, 2L B) 3K, 2L and 2K, 3L C) 2K, 3L and 4K, 2L D) all of the above

A) measures how total cost changes when input prices change. B) measures how total cost changes when one more unit of output is produced. C) is less than average cost when average cost is decreasing. D) both a and b E) both b and c Questions 49 through 53 refer to the following: Suppose that the firm's only variable input is labor. When 50 workers are used, the average product of labor is 50 and the marginal product of labor is 75. The wage rate is $80 and the total cost of the fixed input is $500. A) measures how total cost changes when input prices change. B) measures how total cost changes when one more unit of output is produced. C) is less than average cost when average cost is decreasing. D) both a and b E) both b and c Questions 49 through 53 refer to the following: Suppose that the firm's only variable input is labor. When 50 workers are used, the average product of labor is 50 and the marginal product of labor is 75. The wage rate is $80 and the total cost of the fixed input is $500.

Refer to the following: The capital stock is fixed at 50 units, the price of capital is $30 per unit, and the price of labor is $25 per unit. \[\begin{array} { c c } &\text { Average } \\ \text { Output } & \text { Variable Cost }\\ \hline 10 & \$ 40 \\ 20 & 30 \\ 30 & 45 \\ 40 & 60 \\ \hline \end{array}\] -If the firm produces 30 units of output, how many units of labor does the firm use?

A) 30 B) 45 C) 54 D) 60 E) none of the above A) 30 B) 45 C) 54 D) 60 E) none of the above

Refer to the following: The capital stock is fixed at 40 units, the price of capital is $15 per unit, and the price of labor is $80 per unit. \[\begin{array} { c c } \text { units of } & \text { units of } \\ \text { Labor } & \text { Output } \\ \hline 5 & 40 \\ 10 & 100 \\ 15 & 180 \\ 20 & 220 \end{array}\] -If the firm produces 180 units of output, what is total variable cost?

A) $1,200 B) $1,800 C) $14,400 D) $17,100 E) none of the above A) $1,200 B) $1,800 C) $14,400 D) $17,100 E) none of the above

Firm A plans to produce 500 units per day of good X. The firm can choose either of the following two input combination t produce 500 units per day. $\begin{array}{l|c|c|} \hline& \text { Process 1 } & \text { Process 2 } \\ \hline labor&8 & 12 \\ \hline capital&14 & 7 \\ \hline \end{array}$ To obtain the services of labor and capital for a day, firm A must pay wages of $100 per unit of labor and $80 per unit of capital. For firm A, process ________ (1, 2) is economically efficient because the efficient process costs $___________ compared with $__________ for the inefficient process. Show your work here:

The answer of Firm A plans to produce 500 units...

Refer to the following: $\begin{array}{ccccccccc} & & \text { Total } & \text { Total } & \text { Average } & \text { Average } & \text { Average } & \\ & \text { Total } & \text { Fixed } & \text { Variable } & \text { Fixed } & \text { Variable } & \text { Total } & \text { Marginal } \\ \text { Output } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost }\\ \hline 100&560&-&60&-&-&-&-\\200&-&-&-&-&-&-&4.00\\300&-&-&-&-&4.00-&-&-\\400&-&-&-&-&-&7.00&-\\ \end{array}$ -What is average fixed cost when 300 units of output are produced?

A) $0.60 B) $3.00 C) $160 D) $500 E) none of the above A) $0.60 B) $3.00 C) $160 D) $500 E) none of the above

Refer to the following: $\begin{array}{ccccccccc} & & \text { Total } & \text { Total } & \text { Average } & \text { Average } & \text { Average } & \\ & \text { Total } & \text { Fixed } & \text { Variable } & \text { Fixed } & \text { Variable } & \text { Total } & \text { Marginal } \\ \text { Output } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost } & \text { Cost }\\ \hline 100&560&-&60&-&-&-&-\\200&-&-&-&-&-&-&4.00\\300&-&-&-&-&4.00-&-&-\\400&-&-&-&-&-&7.00&-\\ \end{array}$ -What is average total cost when 200 units of output are produced?

A) $2.30 B) $2.50 C) $4.00 D) $4.80 E) none of the above A) $2.30 B) $2.50 C) $4.00 D) $4.80 E) none of the above

Exam 8: Production and Cost in the Short Run

Refer to the following: Units of Labor Totel Praduet Average Product Narginal Produet 1 - - 100 2 - 125 - 3 300 - - 4 - - 20 5 290 - - -In the table above, diminishing returns

Free

(Multiple Choice)

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Question 1

Correct Answer:

Verified

B

Refer to the following: Above is a firm's average product of labor and marginal product of labor curves. The price of labor is $60 per unit. -Diminishing returns set in with the

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(Multiple Choice)

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Question 2

Correct Answer:

Verified

B

Fill in the blanks in the table below and answer the next questions: -In the above table, marginal product is negative when _____ units of labor are employed.

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(Multiple Choice)

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Question 3

Correct Answer:

Verified

D

Refer to the following: A firm produces 4,000 units of output using 500 workers. Marginal cost is $10, the wage rate is $160, and total fixed cost is $100,000. -What is the marginal product of labor?

(Multiple Choice)

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Question 4

Refer to the following: The amount of total output produced from various combinations of labor and capital. nbsp; nbsp; nbsp; nbsp; nbsp; Units of Capital 1 2 3 4 Units 1 20 36 48 53 of 2 38 68 88 94 Iabor 3 53 94 122 133 4 63 112 148 164 5 68 120 164 184 -Which of the following input combinations can produce the same level of output?

(Multiple Choice)

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Question 5

Marginal cost

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Question 6

Refer to the following: "Ford built 18 vehicles per auto employee in North America last year, while GM could only manage 12." (The Wall Street Journal) -In comparison with GM, Ford had

(Multiple Choice)

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Question 7

Refer to the following: The capital stock is fixed at 50 units, the price of capital is $30 per unit, and the price of labor is $25 per unit. Average Output Variable Cost 10 \ 40 20 30 30 45 40 60 -If the firm produces 30 units of output, how many units of labor does the firm use?

(Multiple Choice)

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Question 8

Refer to the following: The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,800. Fixed cost is $160,000. -What is AVC at its minimum?

(Multiple Choice)

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Question 9

Refer to the following: The capital stock is fixed at 40 units, the price of capital is $15 per unit, and the price of labor is $80 per unit. units of units of Labor Output 5 40 10 100 15 180 20 220 -If the firm produces 180 units of output, what is total variable cost?

(Multiple Choice)

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Question 10

Firm A plans to produce 500 units per day of good X. The firm can choose either of the following two input combination t produce 500 units per day. Process 1 Process 2 labor 8 12 capital 14 7 To obtain the services of labor and capital for a day, firm A must pay wages of $100 per unit of labor and $80 per unit of capital. For firm A, process __ (1, 2) is economically efficient because the efficient process costs $_ compared with $______ for the inefficient process. Show your work here:

(Short Answer)

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Question 11

Refer to the following: The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,800. Fixed cost is $160,000. -When the firm uses 40 units of labor, how much output does it produce?

(Multiple Choice)

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Question 12

Short-run average cost is

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Question 13

Diminishing returns refers to the decrease in

(Multiple Choice)

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Question 14

Refer to the following: Suppose a firm is hiring 20 workers at a wage rate of $60. The average product of labor is 30, the last worker added 12 units of output, and total fixed cost is $3,600. -What is marginal cost?

(Multiple Choice)

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Question 15

Use the following table, showing the total output produced with various levels labor and each of two levels of capital to answer the questions. Units of Capitel Units of Labor =2 =4 1 20 40 2 50 100 3 70 140 4 80 160 -When capital is fixed at 4 units. a. AP decreases after units of labor. MP decreases after units of labor. b. At L = 2, AP = and MP = . c. At L = 3, AP = and MP = . d. At L = 4, AP = and MP = .

(Short Answer)

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Question 16

Refer to the following: Total Total Average Average Average Total Fixed Variable Fixed Variable Total Marginal Output Cost Cost Cost Cost Cost Cost Cost 100 560 - 60 - - - - 200 - - - - - - 4.00 300 - - - - 4.00- - - 400 - - - - - 7.00 - -What is average fixed cost when 300 units of output are produced?

(Multiple Choice)

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Question 17

Refer to the following: Total Total Average Average Average Total Fixed Variable Fixed Variable Total Marginal Output Cost Cost Cost Cost Cost Cost Cost 100 560 - 60 - - - - 200 - - - - - - 4.00 300 - - - - 4.00- - - 400 - - - - - 7.00 - -What is average total cost when 200 units of output are produced?

(Multiple Choice)

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Question 18

Refer to the following: Suppose that the firm's only variable input is labor. When 50 workers are used, the average product of labor is 50 and the marginal product of labor is 75. The wage rate is $80 and the total cost of the fixed input is $500. -Suppose that installation of a new assembly line increases the output produced per worker. The cost per unit of output

(Multiple Choice)

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Question 19

Refer to the following: A firm produces 4,000 units of output using 500 workers. Marginal cost is $10, the wage rate is $160, and total fixed cost is $100,000. -What output is 4,000 units,

(Multiple Choice)

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Question 20

Refer to the following: Units of Labor Totel Praduet Average Product Narginal Produet 1 - - 100 2 - 125 - 3 300 - - 4 - - 20 5 290 - - -In the table above, diminishing returns

Refer to the following: Above is a firm's average product of labor and marginal product of labor curves. The price of labor is $60 per unit. -Diminishing returns set in with the

Fill in the blanks in the table below and answer the next questions: -In the above table, marginal product is negative when _____ units of labor are employed.

Refer to the following: A firm produces 4,000 units of output using 500 workers. Marginal cost is $10, the wage rate is $160, and total fixed cost is $100,000. -What is the marginal product of labor?

Marginal cost

Refer to the following: "Ford built 18 vehicles per auto employee in North America last year, while GM could only manage 12." (The Wall Street Journal) -In comparison with GM, Ford had

Refer to the following: The capital stock is fixed at 50 units, the price of capital is $30 per unit, and the price of labor is $25 per unit. Average Output Variable Cost 10 \ 40 20 30 30 45 40 60 -If the firm produces 30 units of output, how many units of labor does the firm use?

Refer to the following: The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,800. Fixed cost is $160,000. -What is AVC at its minimum?

Refer to the following: The capital stock is fixed at 40 units, the price of capital is $15 per unit, and the price of labor is $80 per unit. units of units of Labor Output 5 40 10 100 15 180 20 220 -If the firm produces 180 units of output, what is total variable cost?

Refer to the following: The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,800. Fixed cost is $160,000. -When the firm uses 40 units of labor, how much output does it produce?

Short-run average cost is

Diminishing returns refers to the decrease in

Refer to the following: Suppose a firm is hiring 20 workers at a wage rate of $60. The average product of labor is 30, the last worker added 12 units of output, and total fixed cost is $3,600. -What is marginal cost?

Refer to the following: A firm produces 4,000 units of output using 500 workers. Marginal cost is $10, the wage rate is $160, and total fixed cost is $100,000. -What output is 4,000 units,

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