Exam 11: Output and Costs

A change in technology that shifts the firm's total product curve upward without changing the quantity of capital used

When marginal cost is greater than average cost, average cost decreases as output increases.

The average variable cost curve shifts downward if

Explain how new technologies, which increase productivity, affect the average variable cost, average total cost, and marginal cost curves.

Total cost is equal to the

In the long run

A company could produce 99 units of a good for $316 or produce 100 units of the same good for $320. The marginal cost of the 100th unit

-The production and cost information provided in the table above for Flaming Fernando's, a restaurant that sells Fiery Frijoles, is for the

-In the above figure, which of the following statements is FALSE?

-The above table gives some cost data for Peter's Pickles. Peter's fixed cost is $20. The marginal cost of increasing output from 3 to 4 barrels of pickles is

-In the above table, what is average product when 4 workers are employed?

-Silvio's Pizza is a small pizzeria. The firm's production function is shown in the table above. Suppose that Silvio's costs include only the cost of renting ovens, which is $100 per oven per week, the labor cost, $280 per worker per week, and the opportunity cost of Silvio's entrepreneurship, $1,000 per week. Suppose Silvio's uses Plant 2. The firm's average total cost is minimized when ________ pizzas per week are produced.

Average total costs are

Economies of scale

-Farmer Seth has a perfectly flat long-run average total cost curve over the range of output from 10,000 bushels of wheat to 100,000 bushels of wheat. Hence, over this range of output, Farmer Seth definitely experiences

When long-run average cost decreases as output increases, there are definitely I. increasing marginal returns. II) economies of scale.

-Based on the above figure, at which level of output does diminishing marginal returns first occur at Ike's Ice Cream Kitchen?

Which of the following statements is TRUE?

-The table above gives a firm's total product schedule. Suppose labor is the only variable factor of production. The price of labor is $500 per week and total fixed costs are $600 per week. What is the marginal cost of producing the 90th unit?

-The above (incomplete) table provides information about the relationships between labor and various product measures. The average product of the fourth unit of labor