Exam 11: Technology, Production, and Costs

Over the past twenty years, the number of small family farms has fallen significantly and in their place there are fewer, but larger, farms owned by corporations. Which of the following best explains this trend?

Suppose the price of capital and labor remain constant but that the average educational level of workers has increased and therefore, productivity of labor increases. This would lead a firm

Which of the following is the best example of a short-run adjustment?

Sam Lewis owns a firm in New York City's Garment District. If Sam keeps adding workers to use the same number of sewing machines, eventually the workplace will become so crowded that workers will get in each other's way. At this point

The production function shows

If the 15th unit of output has a marginal cost of $29.50 and the average cost of producing 14 units of output is $30.23, what will happen to the average cost of production if the 15th unit is produced?

Which of the following equations is incorrect?

Table 11-1 Table 11-1 shows the technology of production at the Matsuko's Mushroom Farm for the month of May. -Refer to Table 11-1. What is the marginal product of the 4th worker?

As output increases, average fixed cost gets smaller and smaller.

Table 11-7 Table 11-7 shows cost data for Lotus Lanterns, a producer of whimsical night lights. -Refer to Table 11-7. What is the marginal cost per unit of production when the firm produces 100 lanterns?

A curve showing the lowest cost at which a firm is able to produce a given level of output in the long run is

Figure 11-17 -A firm's expansion path

The rules of accounting generally require that ________ costs be used for purposes of keeping a company's financial records and for paying taxes. These costs are sometimes called ________ costs.

Figure 11-1 -Refer to Figure 11-1. The marginal product of the 7th worker is

In the long run the relevant cost is total cost.

The level of output at which all economies of scale have been exhausted is known as

In the short run, why does a production function eventually display diminishing returns to labor?

Use a long-run average cost curve graph to illustrate how diseconomies of scale would not make it beneficial for two companies to go through with a merger.

Figure 11-2 -Refer to Figure 11-2. The curve labeled "F" is

Explain how the listed events (a-d) would affect the following at Hilton Hotels. i. Marginal cost ii. Average variable cost iii. Average fixed cost iv. Average total cost a. Hilton decides on an across-the-board 5 percent increase in executive salaries. b. Hilton decides to eliminate all print advertising. c. Hilton signs a new contract with the Culinary Workers Union that requires the company to increase wages for all its kitchen workers. d. The federal government starts to levy a $5 room tax on all hotel rooms.