Question 1

When there are diminishing marginal returns to labor, the marginal product of the last worker hired must be negative.

Accepted Answer

A) True 
 B)False

Question 2

-Are the curves in the figure above drawn CORRECTLY? If not, what's wrong?

Accepted Answer

The curves are not drawn correctly. Firs

Question 3

When long-run average cost increases as output increases there are

Accepted Answer

A)  economies of scale. 
B)  diseconomies of scale. 
C)  constant returns to scale. 
D)  none of the above. 
A)  economies of scale. 
B)  diseconomies of scale. 
C)  constant returns to scale. 
D)  none of the above.

Question 4

Tony's Pizza's production function is shown in the table above. Tony currently operates Plant 2. He hires workers at a wage rate of $50 a day and his total fixed cost is $150.
a) Calculate Tony's Pizza's total variable cost and total cost for each output level.
b) Calculate the marginal costs.
c) Calculate the average fixed costs, average variable costs, and average total costs.
d) Suppose that total fixed cost increases to $200. Explain what changes occur in the costs.

Accepted Answer

@#IMG-DLM& a) The total variable cost and total co

Question 5

The vertical distance between the average variable cost curve and the average total cost curve equals average fixed cost.

Accepted Answer

A) True 
 B)False

Question 6

The marginal cost curve intersects the average fixed, average variable, and average total cost curves all at their minimum points.

Accepted Answer

A) True 
 B)False

Question 7

The marginal product and average product curves

Accepted Answer

A)  never intersect. 
B)  intersect at the maximum point of the marginal product curve. 
C)  intersect at the maximum point of the average product curve. 
D)  do not intersect at any predictable point. 
A)  never intersect. 
B)  intersect at the maximum point of the marginal product curve. 
C)  intersect at the maximum point of the average product curve. 
D)  do not intersect at any predictable point.

Question 8

Minneapolis business Rogue Chocolatier sells specialty chocolate bars with a high cocoa content. Rogue can produce 15 chocolate bars per day with one employee, 35 with 2, 50 with 3 and 55 with 4 employees. Which statement is TRUE?

Accepted Answer

A)  Rogue's marginal product curve initially increases and then decreases. 
B)  Rogue's marginal product curve decreases continually. 
C)  Rogue's total product curve increases at an increasing rate. 
D)  Rogue's marginal product curve decreases initially and then increases. 
A)  Rogue's marginal product curve initially increases and then decreases. 
B)  Rogue's marginal product curve decreases continually. 
C)  Rogue's total product curve increases at an increasing rate. 
D)  Rogue's marginal product curve decreases initially and then increases.

Question 9

Total Product, Marginal Product, Average Product
  
-In the above table, the average product of three workers is

Accepted Answer

A)  1. 
B)  2. 
C)  3. 
D)  4. 
A)  1. 
B)  2. 
C)  3. 
D)  4.

Question 10

A firm experiences ________ when its ________ downward as output increases.

Accepted Answer

A)  diseconomies of scale; average total cost curve slopes 
B)  economies of scale; long-run average cost curve slopes 
C)  diminishing marginal returns; long-run average cost curve slopes 
D)  diminishing marginal returns; average total cost curve shifts 
A)  diseconomies of scale; average total cost curve slopes 
B)  economies of scale; long-run average cost curve slopes 
C)  diminishing marginal returns; long-run average cost curve slopes 
D)  diminishing marginal returns; average total cost curve shifts

Question 11

-The table shows some data that describes Tom's T-Shirts' total product when Tom's has 1 sewing machine. When 4 workers are employed

Accepted Answer

A)  average product of labor is a maximum. 
B)  marginal product of labor is less than average product of labor. 
C)  marginal product of labor exceeds average product of labor. 
D)  marginal product of labor equals average product of labor. 
A)  average product of labor is a maximum. 
B)  marginal product of labor is less than average product of labor. 
C)  marginal product of labor exceeds average product of labor. 
D)  marginal product of labor equals average product of labor.

Question 12

When the marginal product equals the average product, the

Accepted Answer

A)  average product curve is downward sloping. 
B)  average product curve is upward sloping. 
C)  marginal product is at its maximum. 
D)  average product is at its maximum. 
A)  average product curve is downward sloping. 
B)  average product curve is upward sloping. 
C)  marginal product is at its maximum. 
D)  average product is at its maximum.

Question 13

The law of diminishing returns states that as a firm increases

Accepted Answer

A)  all the inputs is uses, the marginal product of each of these inputs always decreases. 
B)  a variable input, with a given quantity of fixed inputs, the firm's marginal cost eventually decreases. 
C)  a variable input, with a given quantity of fixed inputs, the marginal product of the variable input eventually decreases. 
D)  a variable input, given the quantity of fixed inputs, the firm's average total cost will eventually decrease. 
A)  all the inputs is uses, the marginal product of each of these inputs always decreases. 
B)  a variable input, with a given quantity of fixed inputs, the firm's marginal cost eventually decreases. 
C)  a variable input, with a given quantity of fixed inputs, the marginal product of the variable input eventually decreases. 
D)  a variable input, given the quantity of fixed inputs, the firm's average total cost will eventually decrease.

Question 14

-The above (incomplete) table provides information about the relationships between labor and various product measures. The total product that can be produced with 6 units of labor is

Accepted Answer

A)  20. 
B)  19. 
C)  More information is needed to answer the question. 
D)  None of the above answers is correct. 
A)  20. 
B)  19. 
C)  More information is needed to answer the question. 
D)  None of the above answers is correct.

Question 15

A period of time in which the quantity of all factors of production used by a firm can be varied is called the

Accepted Answer

A)  market period. 
B)  variable run. 
C)  short run. 
D)  long run. 
A)  market period. 
B)  variable run. 
C)  short run. 
D)  long run.

Question 16

-Cindy's Sweaters' production function is shown in the above table. Cindy rents two knitting machines for $30 a day each and hires workers at a wage rate of $40 a day. What is the marginal cost of the 19th sweater?

Accepted Answer

A)  $40.00 
B)  $20.00 
C)  $10.00 
D)  $8.00 
A)  $40.00 
B)  $20.00 
C)  $10.00 
D)  $8.00

Question 17

If the ATC curve has a positive slope, then the MC curve must be

Accepted Answer

A)  horizontal. 
B)  vertical. 
C)  above the ATC curve. 
D)  below the ATC curve. 
A)  horizontal. 
B)  vertical. 
C)  above the ATC curve. 
D)  below the ATC curve.

Question 18

Explain why average total costs initially decrease and then increase as output increases.

Accepted Answer

Initially, as output increases, both ave

Question 19

A firm has fixed costs

Accepted Answer

A)  in the short run and in the long run. 
B)  in the short run but not in the long run. 
C)  in the long run but not in the short run. 
D)  neither in the long run nor in the short run. 
A)  in the short run and in the long run. 
B)  in the short run but not in the long run. 
C)  in the long run but not in the short run. 
D)  neither in the long run nor in the short run.

Question 20

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

Accepted Answer

A)  A. 
B)  B. 
C)  C. 
D)  none of the curves in the figure. 
A)  A. 
B)  B. 
C)  C. 
D)  none of the curves in the figure.

When there are diminishing marginal returns to labor, the marginal product of the last worker hired must be negative.

-Are the curves in the figure above drawn CORRECTLY? If not, what's wrong?

When long-run average cost increases as output increases there are

The vertical distance between the average variable cost curve and the average total cost curve equals average fixed cost.

The marginal cost curve intersects the average fixed, average variable, and average total cost curves all at their minimum points.

The marginal product and average product curves

Minneapolis business Rogue Chocolatier sells specialty chocolate bars with a high cocoa content. Rogue can produce 15 chocolate bars per day with one employee, 35 with 2, 50 with 3 and 55 with 4 employees. Which statement is TRUE?

Total Product, Marginal Product, Average Product -In the above table, the average product of three workers is

A firm experiences when its downward as output increases.

-The table shows some data that describes Tom's T-Shirts' total product when Tom's has 1 sewing machine. When 4 workers are employed

When the marginal product equals the average product, the

The law of diminishing returns states that as a firm increases

-The above (incomplete) table provides information about the relationships between labor and various product measures. The total product that can be produced with 6 units of labor is

A period of time in which the quantity of all factors of production used by a firm can be varied is called the

-Cindy's Sweaters' production function is shown in the above table. Cindy rents two knitting machines for $30 a day each and hires workers at a wage rate of $40 a day. What is the marginal cost of the 19th sweater?

If the ATC curve has a positive slope, then the MC curve must be

Explain why average total costs initially decrease and then increase as output increases.

A firm has fixed costs

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

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

Exam 11: Output and Costs

When there are diminishing marginal returns to labor, the marginal product of the last worker hired must be negative.

-Are the curves in the figure above drawn CORRECTLY? If not, what's wrong?

When long-run average cost increases as output increases there are

The vertical distance between the average variable cost curve and the average total cost curve equals average fixed cost.

The marginal cost curve intersects the average fixed, average variable, and average total cost curves all at their minimum points.

The marginal product and average product curves

Minneapolis business Rogue Chocolatier sells specialty chocolate bars with a high cocoa content. Rogue can produce 15 chocolate bars per day with one employee, 35 with 2, 50 with 3 and 55 with 4 employees. Which statement is TRUE?

Total Product, Marginal Product, Average Product -In the above table, the average product of three workers is

A firm experiences ________ when its ________ downward as output increases.

-The table shows some data that describes Tom's T-Shirts' total product when Tom's has 1 sewing machine. When 4 workers are employed

When the marginal product equals the average product, the

The law of diminishing returns states that as a firm increases

-The above (incomplete) table provides information about the relationships between labor and various product measures. The total product that can be produced with 6 units of labor is

A period of time in which the quantity of all factors of production used by a firm can be varied is called the

-Cindy's Sweaters' production function is shown in the above table. Cindy rents two knitting machines for $30 a day each and hires workers at a wage rate of $40 a day. What is the marginal cost of the 19th sweater?

If the ATC curve has a positive slope, then the MC curve must be

Explain why average total costs initially decrease and then increase as output increases.

A firm has fixed costs

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

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Organizing Production

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Public Choices, Public Goods, and Healthcare

Externalities

Markets for Factors of Production

Economic Inequality

Uncertainty and Information

Filters

A firm experiences when its downward as output increases.