Question 1

When the marginal and average products of labor are equal to each other, the

Accepted Answer

A)  average product must be at its maximum value. 
B)  marginal product must be at its maximum value. 
C)  total product must be at its maximum value. 
D)  None of the above answers is correct 
A)  average product must be at its maximum value. 
B)  marginal product must be at its maximum value. 
C)  total product must be at its maximum value. 
D)  None of the above answers is correct

Question 2

-The above table shows the short-run total product schedule for the campus book store. What is the marginal product (MP) of going from 5 to 6 employees at the book store?

Accepted Answer

A)  83 books sold 
B)  13.83 books sold 
C)  10 books sold 
D)  between 11 and 14 books sold 
A)  83 books sold 
B)  13.83 books sold 
C)  10 books sold 
D)  between 11 and 14 books sold

Question 3

Jefferson's Cleaners  
-Using the above table, what is the average product of labor when Jefferson's Cleaners employs six workers?

Accepted Answer

A)  11 suits per day 
B)  12 suits per day 
C)  13 suits per day 
D)  14 suits per day 
A)  11 suits per day 
B)  12 suits per day 
C)  13 suits per day 
D)  14 suits per day

Question 4

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 5

Total Product, Marginal Product, Average Product  
-In the above table, the average product is less than the marginal product

Accepted Answer

A)  when the first worker is hired. 
B)  when the second worker is hired. 
C)  when the third worker is hired. 
D)  for the entire range of output given. 
A)  when the first worker is hired. 
B)  when the second worker is hired. 
C)  when the third worker is hired. 
D)  for the entire range of output given.

Question 6

Economies of scale occur when the percentage increase in output

Accepted Answer

A)  exceeds the percentage increase in all inputs. 
B)  is less than the percentage increase in all inputs. 
C)  exceeds the percentage decrease in all inputs. 
D)  is less than the percentage decrease in all inputs. 
A)  exceeds the percentage increase in all inputs. 
B)  is less than the percentage increase in all inputs. 
C)  exceeds the percentage decrease in all inputs. 
D)  is less than the percentage decrease in all inputs.

Question 7

Points below a firm's total product curve are

Accepted Answer

A)  both attainable and technologically efficient. 
B)  neither attainable nor technologically efficient. 
C)  attainable but not technologically efficient. 
D)  technologically efficient but not attainable. 
A)  both attainable and technologically efficient. 
B)  neither attainable nor technologically efficient. 
C)  attainable but not technologically efficient. 
D)  technologically efficient but not attainable.

Question 8

Total fixed cost is the sum of all

Accepted Answer

A)  costs of the firm's fixed factors of production. 
B)  costs associated with the production of goods. 
C)  costs that rise as output increases. 
D)  the marginal costs of the different factors of production. 
A)  costs of the firm's fixed factors of production. 
B)  costs associated with the production of goods. 
C)  costs that rise as output increases. 
D)  the marginal costs of the different factors of production.

Question 9

A firm's total product curve shows that at first it has

Accepted Answer

A)  economies of scale and then diseconomies of scale. 
B)  diseconomies of scale and then economies of scale. 
C)  increasing marginal returns and then diminishing marginal returns. 
D)  diminishing marginal returns and then increasing marginal returns. 
A)  economies of scale and then diseconomies of scale. 
B)  diseconomies of scale and then economies of scale. 
C)  increasing marginal returns and then diminishing marginal returns. 
D)  diminishing marginal returns and then increasing marginal returns.

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

The marginal product of labor is the

Accepted Answer

A)  change in output resulting from a one-unit increase in labor with all other inputs remaining the same. 
B)  maximum output attainable with fixed factors of production when labor is the only variable factor of production. 
C)  output level above which the slope of the total product curve falls. 
D)  output level above which the rate of total product per unit of labor falls. 
A)  change in output resulting from a one-unit increase in labor with all other inputs remaining the same. 
B)  maximum output attainable with fixed factors of production when labor is the only variable factor of production. 
C)  output level above which the slope of the total product curve falls. 
D)  output level above which the rate of total product per unit of labor falls.

Question 12

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

Accepted Answer

A)  average fixed cost 
B)  average variable cost 
C)  average total cost 
D)  marginal cost 
A)  average fixed cost 
B)  average variable cost 
C)  average total cost 
D)  marginal cost

Question 13

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

Accepted Answer

A)  average fixed cost 
B)  average variable cost 
C)  average total cost 
D)  marginal cost 
A)  average fixed cost 
B)  average variable cost 
C)  average total cost 
D)  marginal cost

Question 14

Which of the following is FALSE?

Accepted Answer

A)  Long-run average variable costs equal long-run average total costs. 
B)  Fixed costs increase in the long run. 
C)  As a firm produces more output, eventually it experiences diseconomies of scale. 
D)  In the long run, both the amount of capital and labor used by the firm can be changed. 
A)  Long-run average variable costs equal long-run average total costs. 
B)  Fixed costs increase in the long run. 
C)  As a firm produces more output, eventually it experiences diseconomies of scale. 
D)  In the long run, both the amount of capital and labor used by the firm can be changed.

Question 15

-In the above table, the marginal product of the 7th worker is 6. What is the total product when 7 workers are employed?

Accepted Answer

A)  68 
B)  70 
C)  72 
D)  76 
A)  68 
B)  70 
C)  72 
D)  76

Question 16

All the production points that lie above the total product curve are inefficient.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following statements is TRUE?

Accepted Answer

A)  If average product equals marginal product, average product decreases. 
B)  If marginal product equals average product, average product is a maximum. 
C)  If marginal product equals average product, marginal product is a maximum. 
D)  If marginal product exceeds average product, marginal product increases. 
A)  If average product equals marginal product, average product decreases. 
B)  If marginal product equals average product, average product is a maximum. 
C)  If marginal product equals average product, marginal product is a maximum. 
D)  If marginal product exceeds average product, marginal product increases.

Question 18

-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. If Cindy produces 18 sweaters per day, what is her average total cost?

Accepted Answer

A)  $6.67 
B)  $10.00 
C)  $11.00 
D)  $13.33 
A)  $6.67 
B)  $10.00 
C)  $11.00 
D)  $13.33

Question 19

A firm's average total cost is $60, its average variable cost is $30, and its total fixed cost is $600. Its output is

Accepted Answer

A)  20 units. 
B)  30 units. 
C)  40 units. 
D)  50 units. 
A)  20 units. 
B)  30 units. 
C)  40 units. 
D)  50 units.

Question 20

Jefferson's Cleaners  
-Using the above table, when Jefferson's Cleaners hires three workers

Accepted Answer

A)  the average product of labor is greater than the marginal product. 
B)  the marginal product of labor is greater than the average product. 
C)  it has already experienced diminishing marginal returns. 
D)  Both answers A and C are correct. 
A)  the average product of labor is greater than the marginal product. 
B)  the marginal product of labor is greater than the average product. 
C)  it has already experienced diminishing marginal returns. 
D)  Both answers A and C are correct.

When the marginal and average products of labor are equal to each other, the

-The above table shows the short-run total product schedule for the campus book store. What is the marginal product (MP) of going from 5 to 6 employees at the book store?

Jefferson's Cleaners -Using the above table, what is the average product of labor when Jefferson's Cleaners employs six workers?

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

Total Product, Marginal Product, Average Product -In the above table, the average product is less than the marginal product

Economies of scale occur when the percentage increase in output

Points below a firm's total product curve are

Total fixed cost is the sum of all

A firm's total product curve shows that at first it has

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

The marginal product of labor is the

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

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

Which of the following is FALSE?

-In the above table, the marginal product of the 7th worker is 6. What is the total product when 7 workers are employed?

All the production points that lie above the total product curve are inefficient.

Which of the following statements is TRUE?

-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. If Cindy produces 18 sweaters per day, what is her average total cost?

A firm's average total cost is $60, its average variable cost is $30, and its total fixed cost is $600. Its output is

Jefferson's Cleaners -Using the above table, when Jefferson's Cleaners hires three workers

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

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 the marginal and average products of labor are equal to each other, the

-The above table shows the short-run total product schedule for the campus book store. What is the marginal product (MP) of going from 5 to 6 employees at the book store?

Jefferson's Cleaners -Using the above table, what is the average product of labor when Jefferson's Cleaners employs six workers?

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

Total Product, Marginal Product, Average Product -In the above table, the average product is less than the marginal product

Economies of scale occur when the percentage increase in output

Points below a firm's total product curve are

Total fixed cost is the sum of all

A firm's total product curve shows that at first it has

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

The marginal product of labor is the

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

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

Which of the following is FALSE?

-In the above table, the marginal product of the 7th worker is 6. What is the total product when 7 workers are employed?

All the production points that lie above the total product curve are inefficient.

Which of the following statements is TRUE?

-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. If Cindy produces 18 sweaters per day, what is her average total cost?

A firm's average total cost is $60, its average variable cost is $30, and its total fixed cost is $600. Its output is

Jefferson's Cleaners -Using the above table, when Jefferson's Cleaners hires three workers

What Is Economics

The Economic Problem

Demand and Supply

Elasticity

Efficiency and Equity

Government Actions in Markets

Global Markets in Action

Utility and Demand

Possibilities, Preferences, and Choices

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