Question 1

-Use the above figure.At an output equal to "Q" the total cost for the firm will be the area

Accepted Answer

A) OQDC. 
B) OQFA. 
C) OQBC. 
D) OQEB. 
A) OQDC. 
B) OQFA. 
C) OQBC. 
D) OQEB. A

Question 2

The production function does not provide information about

Accepted Answer

A) the technology used in the production process. 
B) the types of inputs used in the production process. 
C) the relationship between changes in quantity of inputs and changes in the quantity of output. 
D) the profits of producing a good. 
A) the technology used in the production process. 
B) the types of inputs used in the production process. 
C) the relationship between changes in quantity of inputs and changes in the quantity of output. 
D) the profits of producing a good. D

Question 3

If the firm can vary all factors of production,it is operating

Accepted Answer

A) at a profit. 
B) at a zero economic profit. 
C) in the short run. 
D) in the long run. 
A) at a profit. 
B) at a zero economic profit. 
C) in the short run. 
D) in the long run. D

Question 4

The observation that after some point,successive equal size increases in a variable factor of production,such as labor,added to fixed factors of production,will result in smaller increases in output is the

Accepted Answer

A) law of diminishing marginal product. 
B) streamlining production function. 
C) consumer equilibrium. 
D) theory of increasing marginal utility. 
A) law of diminishing marginal product. 
B) streamlining production function. 
C) consumer equilibrium. 
D) theory of increasing marginal utility.

Question 5

Changes in production functions are associated with changes in

Accepted Answer

A) the level of output. 
B) demand. 
C) the levels of costs. 
D) technology. 
A) the level of output. 
B) demand. 
C) the levels of costs. 
D) technology.

Question 6

For a hotdog vendor,the hotdog buns represents his

Accepted Answer

A) fixed input. 
B) variable input. 
C) sunk cost. 
D) none of the above. 
A) fixed input. 
B) variable input. 
C) sunk cost. 
D) none of the above.

Question 7

At the output rate at which diminishing marginal product begins,a firm will experience

Accepted Answer

A) constant average total costs. 
B) increasing average fixed costs. 
C) increasing marginal costs. 
D) decreasing average variable costs. 
A) constant average total costs. 
B) increasing average fixed costs. 
C) increasing marginal costs. 
D) decreasing average variable costs.

Question 8

Any activity that results in the conversion of resources into products that can be used in consumption is

Accepted Answer

A) planning. 
B) investment. 
C) production. 
D) discounting. 
A) planning. 
B) investment. 
C) production. 
D) discounting.

Question 9

Which of the following would NOT be considered a fixed cost of production?

Accepted Answer

A) Wages paid to labor 
B) The opportunity cost of capital 
C) Interest payments on a loan 
D) Insurance payments on plant and equipment 
A) Wages paid to labor 
B) The opportunity cost of capital 
C) Interest payments on a loan 
D) Insurance payments on plant and equipment

Question 10

The shape of the short-run average total cost curve is a result of

Accepted Answer

A) economies of scale. 
B) diseconomies of scale. 
C) the law of diminishing marginal product. 
D) falling profits. 
A) economies of scale. 
B) diseconomies of scale. 
C) the law of diminishing marginal product. 
D) falling profits.

Question 11

Use the information from the below table to answer following question(s). $$\begin{array} { c c } 
\begin{array} { c } 
\text { Input of } \
\text { Labor }
\end{array} & \begin{array} { c } 
\text { Total } \
\text { Product }
\end{array} \
\hline 0 & 0 \
1 & 20 \
2 & 50 \
3 & 80 \
4 & 105 \
5 & 125 \
6 & 140 \
7 & 150\\hline
\end{array}$$
-In the above table,the average product for 3 units of labor is

Accepted Answer

A) 30.0. 
B) 26.7. 
C) 26.3. 
D) 25.0. 
A) 30.0. 
B) 26.7. 
C) 26.3. 
D) 25.0.

Question 12

$$\begin{array} { c c c c } 
\text { Labor } & \text { Output } & \begin{array} { c } 
\text { Average Physical } \
\text { Product }
\end{array} & \text { Marginal Product } \
\hline 1 & 10 & & - \
2 & &12 & \
3 & & &15 \
4 & 52 & &  \
5 & & &9\
\end{array}$$
-Using the above table,the marginal product of the 4th worker is

Accepted Answer

A) 12. 
B) 13. 
C) 14. 
D) 15. 
A) 12. 
B) 13. 
C) 14. 
D) 15.

Question 13

Marginal cost is equal to average variable cost

Accepted Answer

A) when average variable cost is at its minimum value. 
B) when marginal cost is at its minimum value. 
C) when average variable cost is getting smaller. 
D) when average variable cost is getting larger. 
A) when average variable cost is at its minimum value. 
B) when marginal cost is at its minimum value. 
C) when average variable cost is getting smaller. 
D) when average variable cost is getting larger.

Question 14

In the short run,average total cost is

Accepted Answer

A) higher than average variable cost. 
B) equal to average variable cost. 
C) less than average variable cost. 
D) sometimes higher and sometimes lower than average variable cost. 
A) higher than average variable cost. 
B) equal to average variable cost. 
C) less than average variable cost. 
D) sometimes higher and sometimes lower than average variable cost.

Question 15

Suppose the manager of a restaurant notices that when she has too many waiters on the floor for a shift that the waiters get in each other's way and fewer dinners are served.This is an example of

Accepted Answer

A) diminishing marginal product. 
B) diminishing marginal utility. 
C) diminishing marginal workforce. 
D) diminishing marginal inputs. 
A) diminishing marginal product. 
B) diminishing marginal utility. 
C) diminishing marginal workforce. 
D) diminishing marginal inputs.

Question 16

-Refer to the above figure.Diseconomies of scale exist

Accepted Answer

A) over the entire range of output. 
B) from output $\mathrm { Q } _ { 2 }$ to
$\mathrm { Q } _ { 5 }$ . 
C) up to output $\mathrm { Q } _ { 2 }$ . 
D) after output $\mathrm { Q } _ { 5 }$ . 
A) over the entire range of output. 
B) from output $\mathrm { Q } _ { 2 }$ to
$\mathrm { Q } _ { 5 }$ . 
C) up to output $\mathrm { Q } _ { 2 }$ . 
D) after output $\mathrm { Q } _ { 5 }$ .

Question 17

-Notice the costs as given in the table below.What is the marginal cost when total cost is $23? $$\begin{array} { c c } 
\text { Total Output } & \text { Total Costs } \
0 & \$ 10 \
1 & \$ 15 \
2 & \$ 18 \
3 & \$ 20 \
4 & \$ 21 \
5 & \$ 23 \
\hline
\end{array}$$

Accepted Answer

A) $5 
B) $3 
C) $2 
D) $1 
A) $5 
B) $3 
C) $2 
D) $1

Question 18

Average total cost equals

Accepted Answer

A) TC/Q. 
B) TVC/Q. 
C) TFC/Q. 
D) change in total cost/change in output. 
A) TC/Q. 
B) TVC/Q. 
C) TFC/Q. 
D) change in total cost/change in output.

Question 19

The marginal product of labor may increase rapidly initially as more

Accepted Answer

A) workers are able to specialize. 
B) total product is decreasing. 
C) the amount of other inputs is held constant. 
D) workers will get crowded in a fixed factory. 
A) workers are able to specialize. 
B) total product is decreasing. 
C) the amount of other inputs is held constant. 
D) workers will get crowded in a fixed factory.

Question 20

$$\begin{array} { c c c c c c c } 
\text { Output } & \begin{array} { c } 
\text { Fixed } \
\text { Costs }
\end{array} & \begin{array} { c } 
\text { Variable } \
\text { Costs }
\end{array} & \begin{array} { c } 
\text { Total } \
\text { Costs }
\end{array} & \begin{array} { c } 
\text { Average } \
\text { Total Costs }
\end{array} & \begin{array} { c } 
\text { Average } \
\text { Variable Costs }
\end{array} & \begin{array} { c } 
\text { Marginal } \
\text { Costs }
\end{array} \
\hline 0 & & \$ 0 & \$ 100 & & & \
1 & & 30 & & & & \
2 & & 50 & & & & \
3 & & 60 & & & & \
4 & & 120 & & & & \
5 & & 200 & & & & \
\hline
\end{array}$$
-In the above table,what is the average total cost to produce 4 units of output?

Accepted Answer

A) $30 
B) $60 
C) $55 
D) $20 
A) $30 
B) $60 
C) $55 
D) $20

-Use the above figure.At an output equal to "Q" the total cost for the firm will be the area

The production function does not provide information about

If the firm can vary all factors of production,it is operating

The observation that after some point,successive equal size increases in a variable factor of production,such as labor,added to fixed factors of production,will result in smaller increases in output is the

Changes in production functions are associated with changes in

For a hotdog vendor,the hotdog buns represents his

At the output rate at which diminishing marginal product begins,a firm will experience

Any activity that results in the conversion of resources into products that can be used in consumption is

Which of the following would NOT be considered a fixed cost of production?

The shape of the short-run average total cost curve is a result of

Use the information from the below table to answer following question(s). Input of Labor Total Product 0 0 1 20 2 50 3 80 4 105 5 125 6 140 7 150 -In the above table,the average product for 3 units of labor is

Labor Output Average Physical Product Marginal Product 1 10 - 2 12 3 15 4 52 5 9 -Using the above table,the marginal product of the 4th worker is

Marginal cost is equal to average variable cost

In the short run,average total cost is

Suppose the manager of a restaurant notices that when she has too many waiters on the floor for a shift that the waiters get in each other's way and fewer dinners are served.This is an example of

-Refer to the above figure.Diseconomies of scale exist

Average total cost equals

The marginal product of labor may increase rapidly initially as more

Output Fixed Costs Variable Costs Total Costs Average Total Costs Average Variable Costs Marginal Costs 0 \ 0 \ 100 1 30 2 50 3 60 4 120 5 200 -In the above table,what is the average total cost to produce 4 units of output?

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, profits, and the Financial Environment of Business

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

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Exam 9: The Firm: Cost and Output Determination

-Use the above figure.At an output equal to "Q" the total cost for the firm will be the area

The production function does not provide information about

If the firm can vary all factors of production,it is operating

The observation that after some point,successive equal size increases in a variable factor of production,such as labor,added to fixed factors of production,will result in smaller increases in output is the

Changes in production functions are associated with changes in

For a hotdog vendor,the hotdog buns represents his

At the output rate at which diminishing marginal product begins,a firm will experience

Any activity that results in the conversion of resources into products that can be used in consumption is

Which of the following would NOT be considered a fixed cost of production?

The shape of the short-run average total cost curve is a result of

Use the information from the below table to answer following question(s). Input of Labor Total Product 0 0 1 20 2 50 3 80 4 105 5 125 6 140 7 150 -In the above table,the average product for 3 units of labor is

Labor Output Average Physical Product Marginal Product 1 10 - 2 12 3 15 4 52 5 9 -Using the above table,the marginal product of the 4th worker is

Marginal cost is equal to average variable cost

In the short run,average total cost is

Suppose the manager of a restaurant notices that when she has too many waiters on the floor for a shift that the waiters get in each other's way and fewer dinners are served.This is an example of

-Refer to the above figure.Diseconomies of scale exist

-Notice the costs as given in the table below.What is the marginal cost when total cost is $23? Total Output Total Costs 0 \ 10 1 \ 15 2 \ 18 3 \ 20 4 \ 21 5 \ 23

Average total cost equals

The marginal product of labor may increase rapidly initially as more

Output Fixed Costs Variable Costs Total Costs Average Total Costs Average Variable Costs Marginal Costs 0 \ 0 \ 100 1 30 2 50 3 60 4 120 5 200 -In the above table,what is the average total cost to produce 4 units of output?

The Nature of Economics

Scarcity and the World of Trade-Offs

Demand and Supply

Extensions of Demand and Supply Analysis

Public Spending and Public Choice

Funding the Public Sector

Demand and Supply Elasticity

Consumer Choice

Rents, profits, and the Financial Environment of Business

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

Regulation and Antitrust Policy in a Globalized Economy

The Labor Market: Demand, supply and Outsourcing

Unions and Labor Market Monopoly Power

Income, poverty, and Health Care

Environmental Economics

Comparative Advantage and the Open Economy

Exchange Rates and the Balance of Payments

Filters