Exam 11: Output and Costs

Average variable cost is equal to

In a diagram with the total cost curve and the total variable cost curve, as output increases, the vertical distance between these two curves

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

A firm has fixed costs

How do the marginal and average products of labor affect a firm's marginal and average variable costs in the short run?

-As illustrated in the above figure, after 60 gallons are produced each hour at Ike's Ice Cream Kitchen, the ATC curve starts to slope upward. The ATC starts to slope upward because the

The average product of labor exceeds the marginal product of labor

All the decisions made by people who operate firms have one overriding objective, which is to ________.

Minneapolis business Rogue Chocolatier sells specialty chocolate bars with a high cocoa content. If Rogue's average total cost decreases as the business increases plant size, then Rogue experiences

-Using the data in the above table, if the firm employs 3 workers, total product (measured in units per day) and average product and marginal product of the third worker (measured in units per worker) are

-Based on the above figure of the costs at Barney's Bagel Bakery, at which level of output will diminishing marginal returns first occur?

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

What factors of production can a firm change in the short run? In the long run?

-The above table gives some cost data for Peter's Pickles. Peter's fixed cost is $20. The average total cost (ATC) when 5 barrels of pickles are produced is

The LRAC curve generally is

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

Which of the following statements is TRUE?

Minneapolis business Rogue Chocolatier sells specialty chocolate bars with a high cocoa content. Most chocolate companies use already processed chocolate to craft their sweets. But Rogue buys raw cocoa beans, and roasts and grinds them until they're in a liquid state and then runs the chocolate through a big squat machine with rollers. Which statement is TRUE for Rogue?

-The average total cost curves for plants A, B, C, and D are shown in the above figure. It is possible that the long-run average cost curve runs through points

-The above table shows the short-run total product schedule for the campus book store. At what levels of books sold per hour will the marginal product of labor be greater than the average product of labor?