Question 1

Accounting costs include explicit and implicit costs.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following statements about fixed costs is correct?

Accepted Answer

A) Fixed costs are not opportunity costs. 
B) Fixed costs must be paid even if the firm's output is zero. 
C) Fixed costs are always the largest portion of total costs. 
D) none of the above 
A) Fixed costs are not opportunity costs. 
B) Fixed costs must be paid even if the firm's output is zero. 
C) Fixed costs are always the largest portion of total costs. 
D) none of the above

Question 3

Table 8.5
-Refer to Table 8.5.If Sherry produces zero earrings,her total fixed costs are:

Accepted Answer

A) $0. 
B) $50. 
C) $100. 
D) indeterminate from this information. 
A) $0. 
B) $50. 
C) $100. 
D) indeterminate from this information.

Question 4

-Refer to Figure 8.6.The total fixed costs for Cyndy's Floral Arrangements are $1,000.If Cyndy's Floral Arrangements produces 200 silk flower arrangements,the average fixed costs are:

Accepted Answer

A) $.20. 
B) $5. 
C) $20. 
D) $200. 
A) $.20. 
B) $5. 
C) $20. 
D) $200.

Question 5

Recall the application about invisible inputs and the cost of fake killer whales,Sea lions off the Washington coast eat steelhead and other fish,depleting some species threatened with extinction and decreasing the harvest of the commercial fishing industry.Rick Funk is a plastics manufacturer who has offered to build a life-sized fiberglass killer whale,mount it on a rail like a roller coaster,and send the whale diving through the water to scare off the sea lions,whales' natural prey.According to Funk,it would cost about $16,000 to make the first whale,including $11,000 for the mold and $5,000 for labor and materials.Once the mold is made,each additional whale would cost an additional $5,000.Why is the mold an invisible input?

Accepted Answer

A) because it cannot be scaled down and still produced the whales 
B) because the cost of producing the mold is not visible in the total cost 
C) because it can be scaled down and still produce the whales 
D) both B and C 
A) because it cannot be scaled down and still produced the whales 
B) because the cost of producing the mold is not visible in the total cost 
C) because it can be scaled down and still produce the whales 
D) both B and C

Question 6

Economic costs include only the implicit costs to a firm.

Accepted Answer

A) True 
 B)False

Question 7

-Refer to Figure 8.1.The lawn mower company's total-product curve shows the following:

Accepted Answer

A) the effects of labor specialization. 
B) the effects of diminishing returns. 
C) the effects of labor specialization and diminishing returns. 
D) none of the above. 
A) the effects of labor specialization. 
B) the effects of diminishing returns. 
C) the effects of labor specialization and diminishing returns. 
D) none of the above.

Question 8

What is the relationship between marginal cost and fixed cost?

Accepted Answer

There is no relationship betwe

Question 9

If the price of a fixed factor of production increases,then:

Accepted Answer

A) total costs are unchanged. 
B) marginal costs will increase. 
C) variable costs are unchanged. 
D) variable costs will increase. 
A) total costs are unchanged. 
B) marginal costs will increase. 
C) variable costs are unchanged. 
D) variable costs will increase.

Question 10

Comment on the following statement: "In the short run,a firm's total costs will be zero if the firm chooses to produce nothing."

Accepted Answer

The statement is likely to be

Question 11

Scenario 8.1: Ana used to work for a Advertising agency where she earned a yearly salary of $60,000.She got tired of working for another company so she opened his own Advertising company.Ana now pays her designer $40,000 per year and spends $25,000 for rent and utilities.She earns $120,000 in annual revenue.
-Refer to Scenario 8.1.Ana's accounting profit is:

Accepted Answer

A) $65,000. 
B) $55,000. 
C) $5,000. 
D) $120,000. 
A) $65,000. 
B) $55,000. 
C) $5,000. 
D) $120,000.

Question 12

If marginal product is negative,then:

Accepted Answer

A) total product will decrease if more of the input is hired. 
B) total product is equal to zero. 
C) marginal product will increase if more of the input is hired. 
D) average product will increase if more of the input is hired. 
A) total product will decrease if more of the input is hired. 
B) total product is equal to zero. 
C) marginal product will increase if more of the input is hired. 
D) average product will increase if more of the input is hired.

Question 13

Scenario 8.1: Ana used to work for a Advertising agency where she earned a yearly salary of $60,000.She got tired of working for another company so she opened his own Advertising company.Ana now pays her designer $40,000 per year and spends $25,000 for rent and utilities.She earns $120,000 in annual revenue.
-Refer to Scenario 8.1.Ana's economic profit is:

Accepted Answer

A) -$55,000. 
B) -$15,000. 
C) -$5,000. 
D) -$120,000. 
A) -$55,000. 
B) -$15,000. 
C) -$5,000. 
D) -$120,000.

Question 14

-Refer to Figure 8.3.The vertical distance AB represents:

Accepted Answer

A) total fixed costs. 
B) marginal costs. 
C) average fixed costs. 
D) average total costs. 
A) total fixed costs. 
B) marginal costs. 
C) average fixed costs. 
D) average total costs.

Question 15

Which of the following is most likely to be a variable cost for a firm?

Accepted Answer

A) the interest payments made on equipment loans 
B) an annual payment for insurance on the firm's plant 
C) the monthly rent on office space that it leased for 5 years 
D) the payments made to match workers' 401K contributions 
A) the interest payments made on equipment loans 
B) an annual payment for insurance on the firm's plant 
C) the monthly rent on office space that it leased for 5 years 
D) the payments made to match workers' 401K contributions

Question 16

The period of time when a firm is unable to change all of inputs,or factors of production,is called the:

Accepted Answer

A) economic term. 
B) short run. 
C) accounting term. 
D) long run. 
A) economic term. 
B) short run. 
C) accounting term. 
D) long run.

Question 17

If the car manufacturer enjoys economies of scale,then an increase in the number of cars manufactured will lead to a(n):

Accepted Answer

A) decrease in average cost. 
B) increase in average cost. 
C) constant average cost. 
D) decrease in total cost. 
A) decrease in average cost. 
B) increase in average cost. 
C) constant average cost. 
D) decrease in total cost.

Question 18

When detailing the cost of producing electricity with turbines of different sizes.The concept of scale economies is realized when:

Accepted Answer

A) the average cost tend to decrease as the size of the turbine decreases. 
B) the average cost tend to increase as the size of the turbine decreases. 
C) the average cost tend to decrease as the size of the turbine increases. 
D) the average cost tend to increase as the size of the turbine increases. 
A) the average cost tend to decrease as the size of the turbine decreases. 
B) the average cost tend to increase as the size of the turbine decreases. 
C) the average cost tend to decrease as the size of the turbine increases. 
D) the average cost tend to increase as the size of the turbine increases.

Question 19

Short-run costs that depend on the level of output are:

Accepted Answer

A) total fixed cost only. 
B) total variable costs only. 
C) total costs only. 
D) both total variable costs and total costs. 
A) total fixed cost only. 
B) total variable costs only. 
C) total costs only. 
D) both total variable costs and total costs.

Question 20

Marginal cost equals average total cost:

Accepted Answer

A) when average total cost is at its minimum point. 
B) when marginal cost is at its minimum point. 
C) when average variable cost is at its minimum point. 
D) when there are no fixed costs. 
A) when average total cost is at its minimum point. 
B) when marginal cost is at its minimum point. 
C) when average variable cost is at its minimum point. 
D) when there are no fixed costs.

Accounting costs include explicit and implicit costs.

Which of the following statements about fixed costs is correct?

Table 8.5 -Refer to Table 8.5.If Sherry produces zero earrings,her total fixed costs are:

-Refer to Figure 8.6.The total fixed costs for Cyndy's Floral Arrangements are $1,000.If Cyndy's Floral Arrangements produces 200 silk flower arrangements,the average fixed costs are:

Economic costs include only the implicit costs to a firm.

-Refer to Figure 8.1.The lawn mower company's total-product curve shows the following:

What is the relationship between marginal cost and fixed cost?

If the price of a fixed factor of production increases,then:

Comment on the following statement: "In the short run,a firm's total costs will be zero if the firm chooses to produce nothing."

If marginal product is negative,then:

-Refer to Figure 8.3.The vertical distance AB represents:

Which of the following is most likely to be a variable cost for a firm?

The period of time when a firm is unable to change all of inputs,or factors of production,is called the:

If the car manufacturer enjoys economies of scale,then an increase in the number of cars manufactured will lead to a(n):

When detailing the cost of producing electricity with turbines of different sizes.The concept of scale economies is realized when:

Short-run costs that depend on the level of output are:

Marginal cost equals average total cost:

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand, supply, and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters

Exam 8: Production Technology and Cost

Accounting costs include explicit and implicit costs.

Which of the following statements about fixed costs is correct?

Table 8.5 -Refer to Table 8.5.If Sherry produces zero earrings,her total fixed costs are:

-Refer to Figure 8.6.The total fixed costs for Cyndy's Floral Arrangements are $1,000.If Cyndy's Floral Arrangements produces 200 silk flower arrangements,the average fixed costs are:

Economic costs include only the implicit costs to a firm.

-Refer to Figure 8.1.The lawn mower company's total-product curve shows the following:

What is the relationship between marginal cost and fixed cost?

If the price of a fixed factor of production increases,then:

Comment on the following statement: "In the short run,a firm's total costs will be zero if the firm chooses to produce nothing."

If marginal product is negative,then:

-Refer to Figure 8.3.The vertical distance AB represents:

Which of the following is most likely to be a variable cost for a firm?

The period of time when a firm is unable to change all of inputs,or factors of production,is called the:

If the car manufacturer enjoys economies of scale,then an increase in the number of cars manufactured will lead to a(n):

When detailing the cost of producing electricity with turbines of different sizes.The concept of scale economies is realized when:

Short-run costs that depend on the level of output are:

Marginal cost equals average total cost:

Introduction: What Is Economics

The Key Principles of Economics

Exchange and Markets

Demand, supply, and Market Equilibrium

Elasticity: a Measure of Responsiveness

Market Efficiency and Government Intervention

Consumer Choice: Utility Theory and Insights From Neuroscience

Perfect Competition

Monopoly and Price Discrimination

Market Entry and Monopolistic Competition

Oligopoly and Strategic Behavior

Controlling Market Power: Antitrust and Regulation

Imperfect Information: Adverse Selection and Moral Hazard

Public Goods and Public Choice

External Costs and Environmental Policy

The Labor Market and the Distribution of Income

International Trade and Public Policy

Filters