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

A Detroit business advertises, "The more we sell, the lower the price, and the lower the price, the more we sell." This statement implies that the firm is experiencing

Variable costs increase when output rises.

Figure 7-9 -Of the graphs in Figure 7-9, which represents average fixed cost?

The short run is that period during which there are no fixed commitments.

A firm is operating with an optimal combination of inputs.Suddenly the price of one input rises.The firm should

One reason why critics argue that large firms should not be broken up is that in some cases

Greg's Restaurant specializes in cheeseburger and produces about 2,000 burgers daily.Greg's rent went up by 15 percent over last year.This will result in

Table 7-4 -Table 7-4 shows a production relationship.Assuming the labor input is fixed at 4, what will be the optimum capital input assuming an output price of $1 and a $90-per-day cost for one unit of capital?

Constant returns to scale for a firm would imply that

Marginal physical product can tell a producer

A roller coaster operator produces thrill-packed rides using electricity and a roller coaster.For the roller coaster operator, electricity is

In the short run the firm has at least one fixed input.

-Table 7-2 contains information on widget production.The average physical product of the seventh pound of plastic is calculated as ____.

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

In the short run, if the average cost curve is shown as decreasing, it is because

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, diminishing returns set in with picker

For most industries, average costs decrease indefinitely as output expands.

Complete the table below by computing the missing numbers from those that are given. ​ ​

Which of the following will not lead to increase in the marginal revenue product?

Figure 7-1 -.In Figure 7-1, which graph best represents total physical product with diminishing returns?