Question 1

A profit is made when

Accepted Answer

A)  Total contribution is greater than fixed costs 
B)  Total contribution is less than fixed costs 
C)  Total contribution is equal to variable costs 
D)  Total contribution is greater than variable costs. A

Question 2

Economies of scale occur when total costs fall when output increase

Accepted Answer

A) True 
 B)False  False

Question 3

The short run in economics is less than 5 years

Accepted Answer

A) True 
 B)False  False

Question 4

The shut-down point occurs when

Accepted Answer

A)  Revenue equals fixed costs 
B)  Revenue equals total costs 
C)  Revenue equals variable costs 
D)  Revenue equals contribution

Question 5

If marginal product is greater than average product then average product will fall.

Accepted Answer

A) True 
 B)False

Question 6

The extra output from employing another unit of a variable factor is known as the ________ product. Is it "total"? "marginal"? "average"?

Accepted Answer

The answer of The extra output from employing another unit...

Question 7

If marginal cost is greater than average cost then average costs fall.

Accepted Answer

A) True 
 B)False

Question 8

Fixed costs never change.

Accepted Answer

A) True 
 B)False

Question 9

The total costs are made up of fixed costs plus _________ costs

Accepted Answer

The answer of The total costs are made up of...

Question 10

Labour productivity measures ___________ per employee

Accepted Answer

The answer of Labour productivity measures ___________ per employee...

Question 11

The difference between revenue and variable costs is a _____________ to fixed costs

Accepted Answer

The answer of The difference between revenue and variable costs...

Question 12

The marginal cost curve cuts the average cost at its minimum point.

Accepted Answer

A) True 
 B)False

Question 13

Natural monopolies occur when there are very high diseconomies of scale

Accepted Answer

A) True 
 B)False

Question 14

The level of output at which revenue equals total costs is known as the _______-______ output

Accepted Answer

The answer of The level of output at which revenue...

Exam 4: Managing Costs

A profit is made when

Economies of scale occur when total costs fall when output increase

The short run in economics is less than 5 years

The shut-down point occurs when

If marginal product is greater than average product then average product will fall.

The extra output from employing another unit of a variable factor is known as the ________ product. Is it "total"? "marginal"? "average"?

If marginal cost is greater than average cost then average costs fall.

Fixed costs never change.

The total costs are made up of fixed costs plus _________ costs

Labour productivity measures ___________ per employee

The difference between revenue and variable costs is a _____________ to fixed costs

The marginal cost curve cuts the average cost at its minimum point.

Natural monopolies occur when there are very high diseconomies of scale

The level of output at which revenue equals total costs is known as the _- output