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

The law of diminishing marginal returns is the same as increasing returns to scale.

For a typical firm, the portion of the AC curve that is downward-sloping is because production

John Amaker owns orange groves and hires pickers for a two-week period as shown in Table 7-3. Table 7-3 -In Table 7-3, the marginal physical product of the fifth picker is

Which of the following statements is equivalent to the law of diminishing marginal returns?

Figure 7-10 -In Figure 7-10, the curve labeled C is

Product indifference curves bow inward toward the origin because of diminishing returns to substitution of inputs.

Fixed cost increases when output rises.

Table 7-1 ​ ​ ​ -An example of the law of variable input proportions can be found in

Table 7-1 ​ ​ ​ -In Table 7-1, the marginal physical product of labor after the addition of the fourth worker is

A firm's AC will eventually begin to rise because

Determining the optimal choice of input combinations generally does not involve

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

Figure 7-17 -Which of the following statements must be true when a firm makes choices that put it at point A in Figure 7-17?

Variable cost changes as the time period under consideration changes.

Marginal physical product measures the increase in total output that results from a one-unit increase in an input.

Everything else equal, the AC curve will shift when

The short run is the time period during which

A total cost curve shows the largest amount of a product a firm can produce with a minimum cost.

If diminishing marginal returns are present for an input, then the marginal revenue product will be decreasing.

Table 7-4 -The production relationship in Table 7-4 indicates a process characterized by