Question 1

-Based on the production data for Pat's Pizza Parlor in the above table, which worker has the largest marginal product?

Accepted Answer

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

Question 2

-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

Accepted Answer

A)  $25. 
B)  $75. 
C)  $20. 
D)  $50. 
A)  $25. 
B)  $75. 
C)  $20. 
D)  $50.

Question 3

Decent Donuts  
-Based on the data in the table above, after which worker is hired do diminishing marginal returns begin?

Accepted Answer

A)  the first 
B)  the fifth 
C)  the sixth 
D)  the ninth 
A)  the first 
B)  the fifth 
C)  the sixth 
D)  the ninth

Question 4

Points on 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 5

-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. What is the marginal cost of producing the 200th pizza?

Accepted Answer

A)  $5.09 
B)  $7.00 
C)  $10.55 
D)  $4.40 
A)  $5.09 
B)  $7.00 
C)  $10.55 
D)  $4.40

Question 6

Diminishing marginal returns means that the firm definitely is experiencing

Accepted Answer

A)  diseconomies of scale. 
B)  constant returns to scale. 
C)  Both answers A and B are correct. 
D)  Neither answer A nor B is correct. 
A)  diseconomies of scale. 
B)  constant returns to scale. 
C)  Both answers A and B are correct. 
D)  Neither answer A nor B is correct.

Question 7

The total output produced with any quantity of labor is equal to the sum of the

Accepted Answer

A)  marginal products of each of the workers hired. 
B)  average products of each of the workers hired. 
C)  total wages the firm pays its workers. 
D)  Both answers A and B are correct. 
A)  marginal products of each of the workers hired. 
B)  average products of each of the workers hired. 
C)  total wages the firm pays its workers. 
D)  Both answers A and B are correct.

Question 8

Angel Rodriguez pulls up in his 24-foot panel truck in front of Sezz Medi Brick Oven Pizza in Upper Manhattan. Even though it's the middle of the summer, he's delivering- firewood. He says even though fuel costs have doubled in the past year, it's still worth the premium he gets delivering ash and cherry to the captive and growing market in NYC. How would a decrease in gasoline prices affect Angel's short run costs?

Accepted Answer

A)  Short run total costs would decrease. 
B)  Short run variable costs would increase. 
C)  Short run fixed costs would decrease. 
D)  Short run average variable costs would increase. 
A)  Short run total costs would decrease. 
B)  Short run variable costs would increase. 
C)  Short run fixed costs would decrease. 
D)  Short run average variable costs would increase.

Question 9

The average product of labor is

Accepted Answer

A)  the inverse of the average product of capital. 
B)  the slope of the curve showing the marginal product of labor. 
C)  the slope of the curve showing the total product of labor. 
D)  total product divided by the total quantity of labor employed. 
A)  the inverse of the average product of capital. 
B)  the slope of the curve showing the marginal product of labor. 
C)  the slope of the curve showing the total product of labor. 
D)  total product divided by the total quantity of labor employed.

Question 10

-The above table shows some cost data for Tracey's Tents. What is the average total cost when output is 3?

Accepted Answer

A)  $120 
B)  $30 
C)  $40 
D)  $50 
A)  $120 
B)  $30 
C)  $40 
D)  $50

Question 11

Decent Donuts  
-Based on the data in the table above, which worker at Decent Donuts has the highest marginal product?

Accepted Answer

A)  the fourth 
B)  the fifth 
C)  the sixth 
D)  the seventh 
A)  the fourth 
B)  the fifth 
C)  the sixth 
D)  the seventh

Question 12

In 2008, Precision Pattern Interiors, which makes high-end aircraft interiors, began a $1 million renovation of a building at the Hutchinson Air Base Industrial Tract south of Yoder, Kansas. The company will also add some $400,000 in new equipment and triple its Yoder work force. Which of Precision Pattern Interiors' decisions is a long run decision?

Accepted Answer

A)  $1 million renovation of a building at the Hutchinson Air Base Industrial Tract and $400,000 in new equipment purchases 
B)  $1 million renovation of a building at the Hutchinson Air Base Industrial Tract 
C)  $400,000 in new equipment purchases 
D)  triple its Yoder work force 
A)  $1 million renovation of a building at the Hutchinson Air Base Industrial Tract and $400,000 in new equipment purchases 
B)  $1 million renovation of a building at the Hutchinson Air Base Industrial Tract 
C)  $400,000 in new equipment purchases 
D)  triple its Yoder work force

Question 13

Economies of scale refer to the range of output over which

Accepted Answer

A)  marginal cost exceeds average cost. 
B)  the long-run average cost falls as output increases. 
C)  the marginal product of labor diminishes. 
D)  the long-run average cost is less than the short-run average total cost. 
A)  marginal cost exceeds average cost. 
B)  the long-run average cost falls as output increases. 
C)  the marginal product of labor diminishes. 
D)  the long-run average cost is less than the short-run average total cost.

Question 14

When the marginal product of labor is below the average product of labor, the average product must increase when employment increases.

Accepted Answer

A) True 
 B)False

Question 15

"In the short run, even when output is zero, the firm still has some variable costs it must pay." Is the statement correct or incorrect? Briefly explain your answer.

Accepted Answer

The statement is incorrect. When output

Question 16

-The above (incomplete) table provides information about the relationships between labor and various product measures. The amount of labor that maximizes the marginal product of labor is

Accepted Answer

A)  2 units of labor. 
B)  3 units of labor. 
C)  4 units of labor. 
D)  5 units of labor. 
A)  2 units of labor. 
B)  3 units of labor. 
C)  4 units of labor. 
D)  5 units of labor.

Question 17

A firm's long-run average cost curve

Accepted Answer

A)  shows the lowest attainable average total cost of producing any level of output when the plant and labor are variable. 
B)  is U-shaped. 
C)  tells the firm which plant size to use and which quantity of labor to use to minimize the cost of producing any level of output. 
D)  all of the above 
A)  shows the lowest attainable average total cost of producing any level of output when the plant and labor are variable. 
B)  is U-shaped. 
C)  tells the firm which plant size to use and which quantity of labor to use to minimize the cost of producing any level of output. 
D)  all of the above

Question 18

-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. If 95 units are produced, the average total cost is

Accepted Answer

A)  $6.31. 
B)  $17.45. 
C)  $26.32. 
D)  $32.63. 
A)  $6.31. 
B)  $17.45. 
C)  $26.32. 
D)  $32.63.

Question 19

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 20

-The above table shows the total product of producing baseball hats. The average product of 3 workers is equal to

Accepted Answer

A)  1.67 baseball hats. 
B)  6.00 baseball hats. 
C)  12.78 baseball hats. 
D)  18.00 baseball hats. 
A)  1.67 baseball hats. 
B)  6.00 baseball hats. 
C)  12.78 baseball hats. 
D)  18.00 baseball hats.

-Based on the production data for Pat's Pizza Parlor in the above table, which worker has the largest marginal product?

-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

Decent Donuts -Based on the data in the table above, after which worker is hired do diminishing marginal returns begin?

Points on a firm's total product curve are

Diminishing marginal returns means that the firm definitely is experiencing

The total output produced with any quantity of labor is equal to the sum of the

The average product of labor is

-The above table shows some cost data for Tracey's Tents. What is the average total cost when output is 3?

Decent Donuts -Based on the data in the table above, which worker at Decent Donuts has the highest marginal product?

Economies of scale refer to the range of output over which

When the marginal product of labor is below the average product of labor, the average product must increase when employment increases.

"In the short run, even when output is zero, the firm still has some variable costs it must pay." Is the statement correct or incorrect? Briefly explain your answer.

-The above (incomplete) table provides information about the relationships between labor and various product measures. The amount of labor that maximizes the marginal product of labor is

A firm's long-run average cost curve

-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. If 95 units are produced, the average total cost is

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

-The above table shows the total product of producing baseball hats. The average product of 3 workers is equal to

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

-Based on the production data for Pat's Pizza Parlor in the above table, which worker has the largest marginal product?

-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

Decent Donuts -Based on the data in the table above, after which worker is hired do diminishing marginal returns begin?

Points on a firm's total product curve are

Diminishing marginal returns means that the firm definitely is experiencing

The total output produced with any quantity of labor is equal to the sum of the

The average product of labor is

-The above table shows some cost data for Tracey's Tents. What is the average total cost when output is 3?

Decent Donuts -Based on the data in the table above, which worker at Decent Donuts has the highest marginal product?

Economies of scale refer to the range of output over which

When the marginal product of labor is below the average product of labor, the average product must increase when employment increases.

"In the short run, even when output is zero, the firm still has some variable costs it must pay." Is the statement correct or incorrect? Briefly explain your answer.

-The above (incomplete) table provides information about the relationships between labor and various product measures. The amount of labor that maximizes the marginal product of labor is

A firm's long-run average cost curve

-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. If 95 units are produced, the average total cost is

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

-The above table shows the total product of producing baseball hats. The average product of 3 workers is equal to

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