Question 1

When total product is increasing at an increasing rate,marginal product is

Accepted Answer

A) positive and increasing. 
B) positive and decreasing. 
C) constant. 
D) negative. 
A) positive and increasing. 
B) positive and decreasing. 
C) constant. 
D) negative.

Question 2

The best way to think of the short run and the long run is as

Accepted Answer

A) specific periods of time,although the time periods may differ across industries. 
B) planning terms that apply to managers. 
C) concepts that apply to all people who work for a firm. 
D) a concept that only accountants are concerned with. 
A) specific periods of time,although the time periods may differ across industries. 
B) planning terms that apply to managers. 
C) concepts that apply to all people who work for a firm. 
D) a concept that only accountants are concerned with.

Question 3

$$\begin{array} { c c } 
\begin{array} { c } 
\text { Input of Labor } \
\text { (no. of workers } \
\text { in weeks) }
\end{array} & \begin{array} { c } 
\text { Total Product } \
\text { (no. of snowboards } \
\text { produced) }
\end{array} \
\hline 0 & 0 \
1 & 30 \
2 & 68 \
3 & 110 \
4 & 140 \
5 & 135 \
\hline
\end{array}$$
-In the above table,average physical product is 30 snowboards when

Accepted Answer

A) 4 workers are employed. 
B) 3 workers are employed. 
C) 2 workers are employed. 
D) 1 worker is employed. 
A) 4 workers are employed. 
B) 3 workers are employed. 
C) 2 workers are employed. 
D) 1 worker is employed.

Question 4

Total product will start to decrease

Accepted Answer

A) at the quantity where the law of diminishing returns starts. 
B) when average physical product decreases. 
C) when marginal physical product increases. 
D) when marginal physical product becomes negative. 
A) at the quantity where the law of diminishing returns starts. 
B) when average physical product decreases. 
C) when marginal physical product increases. 
D) when marginal physical product becomes negative.

Question 5

The relationship between inputs and outputs is known as

Accepted Answer

A) business. 
B) manufacturing. 
C) a production function. 
D) marginal product. 
A) business. 
B) manufacturing. 
C) a production function. 
D) marginal product.

Question 6

A firm has the following production relationship between labor and output,for a fixed capital stock. $$\begin{array} { c r } 
\hline\text { Labor } & \text { Output } \
\hline0 & 0 \
1 & 5 \
2 & 11 \
3 & 18 \
4 & 23 \
5 & 26\\hline
\end{array}$$
-According to the above table,what is the average product of labor when five laborers are employed?

Accepted Answer

A) 3 
B) 5.2 
C) 5.75 
D) 6 
A) 3 
B) 5.2 
C) 5.75 
D) 6

Question 7

The typical cost curves are U-shaped due to the

Accepted Answer

A) law of diminishing marginal utility. 
B) law of supply. 
C) law of demand. 
D) law of diminishing marginal product. 
A) law of diminishing marginal utility. 
B) law of supply. 
C) law of demand. 
D) law of diminishing marginal product.

Question 8

Recently Apple Computer developed Apple's new iTunes Music Store,which offers more than 200,000 songs from five major record labels,for use with Apple's iPod and iMac.More than a million songs were downloaded the first week alone! In economic terms,CEO Steve Jobs helped convert capital and labor inputs into products consumers use.Any activity that results in the conversion of resources into products that can be used in consumption is

Accepted Answer

A) not profitable. 
B) a start up venture. 
C) demand. 
D) production. 
A) not profitable. 
B) a start up venture. 
C) demand. 
D) production.

Question 9

The time period during which a firm's capital is fixed but its labor is variable is called

Accepted Answer

A) the planning horizon. 
B) the short run. 
C) the long run. 
D) the very long run. 
A) the planning horizon. 
B) the short run. 
C) the long run. 
D) the very long run.

Question 10

What is the difference between average variable costs and average total costs?

Accepted Answer

Average total costs equal average variab

Question 11

$$\begin{array} { c c } 
\text { Total Output } & \text { Total Costs } \
\hline 0 & \$ 10 \
1 & 18 \
2 & 21 \
3 & 23 \
4 & 24 \
5 & 26 \
6 & 29 \
7 & 33 \
8 & 38 \
9 & 44 \
10 & 51
\end{array}$$
-In the above table,when output is 8 units,average total costs are

Accepted Answer

A) $4.75. 
B) $3.50. 
C) $38. 
D) $28. 
A) $4.75. 
B) $3.50. 
C) $38. 
D) $28.

Question 12

How is the long-run average cost curve found? What is its importance to the firm?

Accepted Answer

The long-run average cost curve is the l

Question 13

"In the short run,a firm cannot change any of its inputs." Do you agree or disagree? Explain.

Accepted Answer

Disagree.The short run is a pe

Question 14

Which of the following statements is correct?

Accepted Answer

A) TC = TFC + TVC 
B) TC = average product + marginal product 
C) TC = TFC - TVC 
D) TC = average physical product - marginal physical product 
A) TC = TFC + TVC 
B) TC = average product + marginal product 
C) TC = TFC - TVC 
D) TC = average physical product - marginal physical product

Question 15

Total product divided by the variable input is

Accepted Answer

A) average total cost. 
B) marginal cost. 
C) average physical product. 
D) marginal physical product. 
A) average total cost. 
B) marginal cost. 
C) average physical product. 
D) marginal physical product.

Question 16

Which of the following would be a fixed input for an amusement park?

Accepted Answer

A) Ticket takers 
B) Unpopped popcorn 
C) Concession workers 
D) The roller coaster 
A) Ticket takers 
B) Unpopped popcorn 
C) Concession workers 
D) The roller coaster

Question 17

When the average physical product is falling,

Accepted Answer

A) average variable costs are rising. 
B) average fixed costs are rising. 
C) total costs are falling. 
D) average variable costs are falling. 
A) average variable costs are rising. 
B) average fixed costs are rising. 
C) total costs are falling. 
D) average variable costs are falling.

Question 18

"Diminishing marginal product is a basic law because new workers are always less qualified than the existing workers." Do you agree or disagree? Explain.

Accepted Answer

Disagree.Diminishing marginal product oc

Question 19

-Refer to the above figure.Average variable costs are represented by curve

Accepted Answer

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

Question 20

When average variable costs are rising,

Accepted Answer

A) marginal physical product is also rising. 
B) marginal costs is falling. 
C) average physical product is rising. 
D) average physical product is falling. 
A) marginal physical product is also rising. 
B) marginal costs is falling. 
C) average physical product is rising. 
D) average physical product is falling.

When total product is increasing at an increasing rate,marginal product is

The best way to think of the short run and the long run is as

Input of Labor (no. of workers in weeks) Total Product (no. of snowboards produced) 0 0 1 30 2 68 3 110 4 140 5 135 -In the above table,average physical product is 30 snowboards when

Total product will start to decrease

The relationship between inputs and outputs is known as

A firm has the following production relationship between labor and output,for a fixed capital stock. Labor Output 0 0 1 5 2 11 3 18 4 23 5 26 -According to the above table,what is the average product of labor when five laborers are employed?

The typical cost curves are U-shaped due to the

The time period during which a firm's capital is fixed but its labor is variable is called

What is the difference between average variable costs and average total costs?

Total Output Total Costs 0 \ 10 1 18 2 21 3 23 4 24 5 26 6 29 7 33 8 38 9 44 10 51 -In the above table,when output is 8 units,average total costs are

How is the long-run average cost curve found? What is its importance to the firm?

"In the short run,a firm cannot change any of its inputs." Do you agree or disagree? Explain.

Which of the following statements is correct?

Total product divided by the variable input is

Which of the following would be a fixed input for an amusement park?

When the average physical product is falling,

"Diminishing marginal product is a basic law because new workers are always less qualified than the existing workers." Do you agree or disagree? Explain.

-Refer to the above figure.Average variable costs are represented by curve

When average variable costs are rising,

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

When total product is increasing at an increasing rate,marginal product is

The best way to think of the short run and the long run is as

Input of Labor (no. of workers in weeks) Total Product (no. of snowboards produced) 0 0 1 30 2 68 3 110 4 140 5 135 -In the above table,average physical product is 30 snowboards when

Total product will start to decrease

The relationship between inputs and outputs is known as

A firm has the following production relationship between labor and output,for a fixed capital stock. Labor Output 0 0 1 5 2 11 3 18 4 23 5 26 -According to the above table,what is the average product of labor when five laborers are employed?

The typical cost curves are U-shaped due to the

The time period during which a firm's capital is fixed but its labor is variable is called

What is the difference between average variable costs and average total costs?

Total Output Total Costs 0 \ 10 1 18 2 21 3 23 4 24 5 26 6 29 7 33 8 38 9 44 10 51 -In the above table,when output is 8 units,average total costs are

How is the long-run average cost curve found? What is its importance to the firm?

"In the short run,a firm cannot change any of its inputs." Do you agree or disagree? Explain.

Which of the following statements is correct?

Total product divided by the variable input is

Which of the following would be a fixed input for an amusement park?

When the average physical product is falling,

"Diminishing marginal product is a basic law because new workers are always less qualified than the existing workers." Do you agree or disagree? Explain.

-Refer to the above figure.Average variable costs are represented by curve

When average variable costs are rising,

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