Question 1

Marginal revenue is the additional revenue a business gets from producing or selling one more unit of input.

Accepted Answer

A) True 
 B)False  True

Question 2

What is the economic process of turning inputs into outputs that a business will sell to customers?

Accepted Answer

A)  Revenue. 
B)  Profit. 
C)  Profit maximization. 
D)  Production. 
A)  Revenue. 
B)  Profit. 
C)  Profit maximization. 
D)  Production. D

Question 3

An example of variable costs is

Accepted Answer

A)  rent on the building a business occupies. 
B)  loans on equipment purchased. 
C)  hourly labor. 
D)  insurance premiums to protect assets. 
A)  rent on the building a business occupies. 
B)  loans on equipment purchased. 
C)  hourly labor. 
D)  insurance premiums to protect assets. C

Question 4

The goods or services purchased by a business for immediate use in the production process are known as

Accepted Answer

A)  intermediate inputs. 
B)  intermediate outputs. 
C)  production inputs. 
D)  production processes. 
A)  intermediate inputs. 
B)  intermediate outputs. 
C)  production inputs. 
D)  production processes.

Question 5

Why would a business use consider both short-term and long-term cost functions in planning?

Accepted Answer

Short-term planning allows a business to

Question 6

Many times,technology is _____ in the equipment a company buys.

Accepted Answer

A)  embodied 
B)  not present 
C)  produced 
D)  part of the production process 
A)  embodied 
B)  not present 
C)  produced 
D)  part of the production process

Question 7

Which of the following is an example of a profit-maximizing business?

Accepted Answer

A)  A charitable organization that provides medical care for disaster victims. 
B)  A local government that provides a police force. 
C)  A household in which a family member takes care of the children. 
D)  An accountant who makes her living preparing tax returns for other people. 
A)  A charitable organization that provides medical care for disaster victims. 
B)  A local government that provides a police force. 
C)  A household in which a family member takes care of the children. 
D)  An accountant who makes her living preparing tax returns for other people.

Question 8

Marginal cost generally ________ quantity produced.

Accepted Answer

A)  rises with 
B)  decreases with 
C)  stays the same with varying 
D)  is not related to 
A)  rises with 
B)  decreases with 
C)  stays the same with varying 
D)  is not related to

Question 9

The main objective of a business in a market economy is

Accepted Answer

A)  profit maximization. 
B)  controlling costs. 
C)  decreasing revenue. 
D)  managing the production function. 
A)  profit maximization. 
B)  controlling costs. 
C)  decreasing revenue. 
D)  managing the production function.

Question 10

Outputs are always goods.

Accepted Answer

A) True 
 B)False

Question 11

Variable costs are relevant for

Accepted Answer

A)  long-term strategic planning. 
B)  short-term everyday decision making. 
C)  businesses only. 
D)  calculating fixed cost percentages. 
A)  long-term strategic planning. 
B)  short-term everyday decision making. 
C)  businesses only. 
D)  calculating fixed cost percentages.

Question 12

_____________ is the added revenue from producing and selling one more unit of output.

Accepted Answer

A)  Added revenue 
B)  Marginal profit 
C)  Marginal cost 
D)  Marginal revenue 
A)  Added revenue 
B)  Marginal profit 
C)  Marginal cost 
D)  Marginal revenue

Question 13

In a simple lawn-mowing business where you have a push mower and labor as input,by adding an additional input in the form of a gas self-propelled mower (capital),what would be the impact on output?

Accepted Answer

A)  Output would remain the same. 
B)  Output would decrease. 
C)  Output would increase. 
D)  Labor would decrease. 
A)  Output would remain the same. 
B)  Output would decrease. 
C)  Output would increase. 
D)  Labor would decrease.

Question 14

In short-run profit maximization,businesses focus on the ______,holding fixed costs constant.

Accepted Answer

A)  long-term cost function 
B)  average input cost 
C)  short-term cost function 
D)  short-term production function 
A)  long-term cost function 
B)  average input cost 
C)  short-term cost function 
D)  short-term production function

Question 15

What happens to the marginal product of labor if more capital is added to a production process?

Accepted Answer

A)  More capital generally causes the marginal product of labor to rise. 
B)  More capital will cause the marginal product of labor not to diminish. 
C)  More capital generally causes the marginal product of labor to fall. 
D)  More capital will affect the marginal product of capital, not the marginal product of labor. 
A)  More capital generally causes the marginal product of labor to rise. 
B)  More capital will cause the marginal product of labor not to diminish. 
C)  More capital generally causes the marginal product of labor to fall. 
D)  More capital will affect the marginal product of capital, not the marginal product of labor.

Question 16

Output divided by the number of hours worked or by the number of workers is called

Accepted Answer

A)  average input. 
B)  average product. 
C)  marginal product. 
D)  marginal revenue. 
A)  average input. 
B)  average product. 
C)  marginal product. 
D)  marginal revenue.

Question 17

Explain,with an example,the type of short-term decisions retailers often have to make.

Accepted Answer

Short-term decisions are made based on c

Question 18

Inputs used by a business in the production process include

Accepted Answer

A)  revenue. 
B)  profit. 
C)  labor. 
D)  cost. 
A)  revenue. 
B)  profit. 
C)  labor. 
D)  cost.

Question 19

Average product is not as reliable an indicator of how a business is doing as it used to be because of

Accepted Answer

A)  variable expenses. 
B)  fixed expenses. 
C)  outsourcing labor. 
D)  outsourcing profit. 
A)  variable expenses. 
B)  fixed expenses. 
C)  outsourcing labor. 
D)  outsourcing profit.

Question 20

Revenue is the money that customers pay for the output of a business.

Accepted Answer

A) True 
 B)False

Marginal revenue is the additional revenue a business gets from producing or selling one more unit of input.

What is the economic process of turning inputs into outputs that a business will sell to customers?

An example of variable costs is

The goods or services purchased by a business for immediate use in the production process are known as

Why would a business use consider both short-term and long-term cost functions in planning?

Many times,technology is _____ in the equipment a company buys.

Which of the following is an example of a profit-maximizing business?

Marginal cost generally ________ quantity produced.

The main objective of a business in a market economy is

Outputs are always goods.

Variable costs are relevant for

_____________ is the added revenue from producing and selling one more unit of output.

In a simple lawn-mowing business where you have a push mower and labor as input,by adding an additional input in the form of a gas self-propelled mower (capital),what would be the impact on output?

In short-run profit maximization,businesses focus on the ______,holding fixed costs constant.

What happens to the marginal product of labor if more capital is added to a production process?

Output divided by the number of hours worked or by the number of workers is called

Explain,with an example,the type of short-term decisions retailers often have to make.

Inputs used by a business in the production process include

Average product is not as reliable an indicator of how a business is doing as it used to be because of

Revenue is the money that customers pay for the output of a business.

Introduction

Demand and Supply: The Basics of the Market Economy

Market Equilibrium and Shifts

Competition and Market Power

Government and the Economy

The First Step Into Macroeconomics

Inflation

Growth

Business Cycles, unemployment and Inflation

Fiscal Policy

Monetary Policy

The Financial Markets

International Trade

Technological Change

Economics of the Labor Market

The Distribution of Income

Economics of Retirement and Healthcare

Economics of Energy, the Environment, and Global Climate Change Glossary

Filters

Exam 4: How Businesses Work

Marginal revenue is the additional revenue a business gets from producing or selling one more unit of input.

What is the economic process of turning inputs into outputs that a business will sell to customers?

An example of variable costs is

The goods or services purchased by a business for immediate use in the production process are known as

Why would a business use consider both short-term and long-term cost functions in planning?

Many times,technology is _____ in the equipment a company buys.

Which of the following is an example of a profit-maximizing business?

Marginal cost generally ________ quantity produced.

The main objective of a business in a market economy is

Outputs are always goods.

Variable costs are relevant for

_____________ is the added revenue from producing and selling one more unit of output.

In a simple lawn-mowing business where you have a push mower and labor as input,by adding an additional input in the form of a gas self-propelled mower (capital),what would be the impact on output?

In short-run profit maximization,businesses focus on the ______,holding fixed costs constant.

What happens to the marginal product of labor if more capital is added to a production process?

Output divided by the number of hours worked or by the number of workers is called

Explain,with an example,the type of short-term decisions retailers often have to make.

Inputs used by a business in the production process include

Average product is not as reliable an indicator of how a business is doing as it used to be because of

Revenue is the money that customers pay for the output of a business.

Introduction

Demand and Supply: The Basics of the Market Economy

Market Equilibrium and Shifts

Competition and Market Power

Government and the Economy

The First Step Into Macroeconomics

Inflation

Growth

Business Cycles, unemployment and Inflation

Fiscal Policy

Monetary Policy

The Financial Markets

International Trade

Technological Change

Economics of the Labor Market

The Distribution of Income

Economics of Retirement and Healthcare

Economics of Energy, the Environment, and Global Climate Change Glossary

Filters