Exam 11: Output and Costs

Which of the following shifts the ATC curve upward at the XYZ Co.?

-In the above figure, the total variable cost curve is curve

-In the figure above, curve A is the ________ curve.

A firm's long-run average cost curve is derived by adding together its short-run average total cost curves.

Decent Donuts -Use the data in the above table and suppose that labor is the only variable factor of production. At what level of output does the marginal cost start to rise at Decent Donuts?

-As illustrated in the above figure, after 40 gallons are produced each hour at Ike's Ice Cream Kitchen, the AVC curve starts to slope upward. The AVC starts to slope upward because the

-In the table above, the marginal product of the 5th worker is ________ units per week.

-The above table shows the total product schedule for Hair Today, a hair styling salon. a) What is the first worker's marginal product? The second worker? The third worker? The fourth worker? The fifth worker? b) Over what range of workers is there increasing marginal returns? Over what range is there decreasing marginal returns?

-The above (incomplete) table provides information about the relationships between labor and various product measures. The amount of labor that maximizes the marginal product of labor is

A firm's total variable cost (TVC) is defined as a cost that

The marginal product of labor is the increase in total product from a

-In the above figure, between 5 and 10 units per hour, the firm experiences

Decent Donuts -Using the table above, for which of the following levels of employment does the average product of labor exceed the marginal product of labor at Decent Donuts?

Which of the following is CORRECT?

For each short-run average total cost curve, the ________ the plant, the ________ is the output at which average total cost is at a ________.

For the past 15 years the American public has wanted to buy big trucks. The Big Three automakers delivered, investing billions in plants that build gas guzzlers. Now, when customers walk into showrooms, gas mileage is on their mind. Retooling the industry will take years, so in the meantime GM, Ford and Chrysler are tweaking their existing models. They're changing tires, adjusting transmissions and exhaust valves in hopes of getting one or maybe two more miles per gallon. Which of the decisions by the Big Three to gain gas mileage is a short run decision?

Jake is a corn farmer in Nebraska. He rents his land on a long-term lease for $250,000 a year. He pays his farm hands $28,000 a year. Is his rent a fixed cost or a variable cost? Are the wages he pays his workers a fixed cost or a variable cost? Briefly explain your answers.

When marginal cost is greater than average total cost, the

What are the two components of a firm's total cost in the short run, and what are their definitions?

A firm's long run cost is the cost of production when the firm