Question 1

If more and more labor is employed while keeping all other inputs constant,the marginal physical productivity of labor will eventually

Accepted Answer

A) increase. 
B) decrease. 
C) remain constant. 
D) We cannot tell from the information provided. 
A) increase. 
B) decrease. 
C) remain constant. 
D) We cannot tell from the information provided. B

Question 2

A production function may exhibit

Accepted Answer

A) constant returns to scale and diminishing marginal productivities to all inputs. 
B) constant returns to scale and diminishing marginal productivities to all but one input,but at least one input must have a constant marginal productivity. 
C) constant returns to scale and diminishing marginal productivity to at most one input. 
D) constant returns to scale and diminishing marginal productivities for no inputs. 
A) constant returns to scale and diminishing marginal productivities to all inputs. 
B) constant returns to scale and diminishing marginal productivities to all but one input,but at least one input must have a constant marginal productivity. 
C) constant returns to scale and diminishing marginal productivity to at most one input. 
D) constant returns to scale and diminishing marginal productivities for no inputs. A

Question 3

The production function $q = k ^ { .6 } l ^ { .5 }$ exhibits

Accepted Answer

A) increasing returns to scale and diminishing marginal products for both K and L. 
B) increasing returns to scale and diminishing marginal product for L only. 
C) increasing returns to scale but no diminishing marginal productivities. 
D) decreasing returns to scale. 
A) increasing returns to scale and diminishing marginal products for both K and L. 
B) increasing returns to scale and diminishing marginal product for L only. 
C) increasing returns to scale but no diminishing marginal productivities. 
D) decreasing returns to scale. A

Question 4

Suppose the production function for good q is given by $q = 3 k + 2 l$ where k and l are capital and labor inputs.Consider three statements about this function: 
I.The function exhibits constant returns to scale.
II.The function exhibits diminishing marginal productivities to all inputs.
III.The function has a constant rate of technical substitution.
Which of these statements is true?

Accepted Answer

A) All of them. 
B) None of them. 
C) I and II but not III. 
D) I and III but not II. 
E) only I. 
A) All of them. 
B) None of them. 
C) I and II but not III. 
D) I and III but not II. 
E) only I.

Question 5

The marginal physical productivity of labor is

Accepted Answer

A) the slope of the total output curve at the relevant point. 
B) the negative of the slope of the total output curve at the relevant point. 
C) the slope of the line connecting the origin with the relevant point on the total output curve. 
D) the negative of the slope of the line connecting the origin with the relevant point on the total output curve. 
A) the slope of the total output curve at the relevant point. 
B) the negative of the slope of the total output curve at the relevant point. 
C) the slope of the line connecting the origin with the relevant point on the total output curve. 
D) the negative of the slope of the line connecting the origin with the relevant point on the total output curve.

Question 6

Which of the following production functions exhibits a constant elasticity of substitution?

Accepted Answer

A) q = 3k + 2l. 
B)  $q = k ^ { 0~5 } l ^ { 0~5 }$ . 
C)  $q = l - \frac { l } { k } - \frac { l } { l }$ . 
D) All of these production functions have a constant elasticity of substitution. 
A) q = 3k + 2l. 
B)  $q = k ^ { 0~5 } l ^ { 0~5 }$ . 
C)  $q = l - \frac { l } { k } - \frac { l } { l }$ . 
D) All of these production functions have a constant elasticity of substitution.

Question 7

The marginal rate of technical substitution (RTS)of labor for capital measures

Accepted Answer

A) the amount by which capital input can be reduced while holding quantity produced constant when one more unit of labor is used. 
B) the amount by which labor input can be reduced while holding quantity produced constant when one more unit of capital is used. 
C) the ratio of total labor to total capital. 
D) the ratio of total capital to total labor. . 
A) the amount by which capital input can be reduced while holding quantity produced constant when one more unit of labor is used. 
B) the amount by which labor input can be reduced while holding quantity produced constant when one more unit of capital is used. 
C) the ratio of total labor to total capital. 
D) the ratio of total capital to total labor. .

Question 8

Consider the production function $q = \left( k ^ { \alpha } + l ^ { \alpha} \right) ^ { \beta }$ . For this function to have diminishing marginal productivities and increasing returns to scale,it must be the case that

Accepted Answer

A) α > 1 αβ  1 αβ > 1. 
C) α  1. 
A) α > 1 αβ  1 αβ > 1. 
C) α  1.

Question 9

The production function $q = \sqrt { k l }$

Accepted Answer

A) exhibits constant returns to scale and constant marginal productivities for k and l. 
B) exhibits diminishing returns to scale and diminishing marginal productivities for k and l. 
C) exhibits constant returns to scale and diminishing marginal productivities for k and l. 
D) exhibits diminishing returns to scale and constant marginal productivities for k and l. 
A) exhibits constant returns to scale and constant marginal productivities for k and l. 
B) exhibits diminishing returns to scale and diminishing marginal productivities for k and l. 
C) exhibits constant returns to scale and diminishing marginal productivities for k and l. 
D) exhibits diminishing returns to scale and constant marginal productivities for k and l.

Question 10

For a fixed proportion production function,at the vertex of any of the (L-shaped)isoquants the marginal productivity of either input is

Accepted Answer

A) constant 
B) zero. 
C) negative. 
D) a value that cannot be determined. 
A) constant 
B) zero. 
C) negative. 
D) a value that cannot be determined.

Question 11

The average productivity of labor reaches its maximum

Accepted Answer

A) at the point of inflection of the total product curve. 
B) where the slope of the total product curve is steepest. 
C) where the slope of the total product curve is zero. 
D) where marginal and average productivity are equal. 
A) at the point of inflection of the total product curve. 
B) where the slope of the total product curve is steepest. 
C) where the slope of the total product curve is zero. 
D) where marginal and average productivity are equal.

Question 12

Graphically,the average productivity of labor is illustrated by

Accepted Answer

A) the slope of the total product curve at the relevant point. 
B) the slope of the marginal productivity curve at the relevant point. 
C) the negative of the slope of the marginal productivity curve at the relevant point. 
D) the slope of the chord connecting the origin with the relevant point on the total output curve. 
A) the slope of the total product curve at the relevant point. 
B) the slope of the marginal productivity curve at the relevant point. 
C) the negative of the slope of the marginal productivity curve at the relevant point. 
D) the slope of the chord connecting the origin with the relevant point on the total output curve.

Question 13

The marginal physical productivity of labor is defined as

Accepted Answer

A) a firm's total output divided by total labor input. 
B) the extra output produced by employing one more unit of labor while allowing other inputs to vary. 
C) the extra output produced by employing one more unit of labor while holding other inputs constant. 
D) the extra output produced by employing one more unit of capital while holding labor input constant. 
A) a firm's total output divided by total labor input. 
B) the extra output produced by employing one more unit of labor while allowing other inputs to vary. 
C) the extra output produced by employing one more unit of labor while holding other inputs constant. 
D) the extra output produced by employing one more unit of capital while holding labor input constant.

Question 14

A firm's isoquant shows

Accepted Answer

A) the amount of labor needed to produce a given level of output with capital held constant. 
B) the amount of capital needed to produce a given level of output with labor held constant. 
C) the various combinations of capital and labor that will produce a given amount of output. 
D) none of these answers is correct. 
A) the amount of labor needed to produce a given level of output with capital held constant. 
B) the amount of capital needed to produce a given level of output with labor held constant. 
C) the various combinations of capital and labor that will produce a given amount of output. 
D) none of these answers is correct.

If more and more labor is employed while keeping all other inputs constant,the marginal physical productivity of labor will eventually

A production function may exhibit

The production function $q = k ^ { .6 } l ^ { .5 }$ exhibits

The marginal physical productivity of labor is

Which of the following production functions exhibits a constant elasticity of substitution?

The marginal rate of technical substitution (RTS)of labor for capital measures

Consider the production function $q = \left( k ^ { \alpha } + l ^ { \alpha} \right) ^ { \beta }$ . For this function to have diminishing marginal productivities and increasing returns to scale,it must be the case that

The production function $q = \sqrt { k l }$

For a fixed proportion production function,at the vertex of any of the (L-shaped)isoquants the marginal productivity of either input is

The average productivity of labor reaches its maximum

Graphically,the average productivity of labor is illustrated by

The marginal physical productivity of labor is defined as

A firm's isoquant shows

Preferences and Utility

Utility Maximization and Choice

Income and Substitution Effects

Demand Relationships Among Goods

Uncertainty and Information

Strategy and Game Theory

Cost Functions

Profit Maximization

The Partial Equilibrium Competitive Model

General Equilibrium and Welfare

Monopoly

Imperfect Competition

Labor Markets

Capital and Time

Asymmetric Information

Externalities and Public Goods

Filters

Exam 7: Production Functions

If more and more labor is employed while keeping all other inputs constant,the marginal physical productivity of labor will eventually

A production function may exhibit

The production function q=k.6l.5q = k ^ { .6 } l ^ { .5 }q=k.6l.5 exhibits

The marginal physical productivity of labor is

Which of the following production functions exhibits a constant elasticity of substitution?

The marginal rate of technical substitution (RTS)of labor for capital measures

Consider the production function q=(kα+lα)βq = \left( k ^ { \alpha } + l ^ { \alpha} \right) ^ { \beta }q=(kα+lα)β . For this function to have diminishing marginal productivities and increasing returns to scale,it must be the case that

The production function q=klq = \sqrt { k l }q=kl​

For a fixed proportion production function,at the vertex of any of the (L-shaped)isoquants the marginal productivity of either input is

The average productivity of labor reaches its maximum

Graphically,the average productivity of labor is illustrated by

The marginal physical productivity of labor is defined as

A firm's isoquant shows

Preferences and Utility

Utility Maximization and Choice

Income and Substitution Effects

Demand Relationships Among Goods

Uncertainty and Information

Strategy and Game Theory

Cost Functions

Profit Maximization

The Partial Equilibrium Competitive Model

General Equilibrium and Welfare

Monopoly

Imperfect Competition

Labor Markets

Capital and Time

Asymmetric Information

Externalities and Public Goods

Filters

The production function $q = k ^ { .6 } l ^ { .5 }$ exhibits

Consider the production function $q = \left( k ^ { \alpha } + l ^ { \alpha} \right) ^ { \beta }$ . For this function to have diminishing marginal productivities and increasing returns to scale,it must be the case that

The production function $q = \sqrt { k l }$