Question 1

​​​Table 13-7  
-Refer to Table 13-7. At which number of workers does diminishing marginal product begin?

Accepted Answer

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

Question 2

Jaxon borrows $10,000 from a bank and withdraws $20,000 from his personal savings to open a tattoo parlor. The interest rate is 3 percent for both the bank loan and his personal savings. Jaxon's implicit costs are $900.
​

Accepted Answer

A) True 
 B)False

Question 3

The marginal product of an input in the production process is the increase in

Accepted Answer

A) total revenue obtained from an additional unit of that input. 
B) profit obtained from an additional unit of that input. 
C) Total revenue obtained from an additional unit of that input. 
D) quantity of output obtained from an additional unit of that input. 
A) total revenue obtained from an additional unit of that input. 
B) profit obtained from an additional unit of that input. 
C) Total revenue obtained from an additional unit of that input. 
D) quantity of output obtained from an additional unit of that input.

Question 4

Fixed costs can be defined as costs that

Accepted Answer

A) vary inversely with production. 
B) vary in proportion with production. 
C) are incurred only when production is large enough. 
D) are incurred even if nothing is produced. 
A) vary inversely with production. 
B) vary in proportion with production. 
C) are incurred only when production is large enough. 
D) are incurred even if nothing is produced.

Question 5

The amount of money that a wheat farmer could have earned if he had planted barley instead of wheat is

Accepted Answer

A) an explicit cost. 
B) an accounting cost 
C) an implicit cost. 
D) forgone accounting profit. 
A) an explicit cost. 
B) an accounting cost 
C) an implicit cost. 
D) forgone accounting profit.

Question 6

The marginal-cost curve intersects the average-total-cost curve at the output level where average fixed costs are zero.

Accepted Answer

A) True 
 B)False

Question 7

Table 13-17
Consider the following table of long-run total cost for four different firms:  
-Refer to Table 13-17. Which firm has economies of scale and then diseconomies of scale as output increases from 1 to 7?

Accepted Answer

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

Question 8

In the long run,

Accepted Answer

A) inputs that were fixed in the short run remain fixed. 
B) inputs that were fixed in the short run become variable. 
C) inputs that were variable in the short run become fixed. 
D) variable inputs are rarely used. 
A) inputs that were fixed in the short run remain fixed. 
B) inputs that were fixed in the short run become variable. 
C) inputs that were variable in the short run become fixed. 
D) variable inputs are rarely used.

Question 9

The graph of the production function plots total cost versus quantity of output.

Accepted Answer

A) True 
 B)False

Question 10

In the long run a company that produces and sells organic tofu incurs total costs of $1,200 when output is 1,200 units and $1,650 when output is 1,400 units. The tofu company exhibits

Accepted Answer

A) diseconomies of scale because total cost is rising as output rises. 
B) diseconomies of scale because average total cost is rising as output rises. 
C) economies of scale because total cost is rising as output rises. 
D) economies of scale because average total cost is falling as output rises. 
A) diseconomies of scale because total cost is rising as output rises. 
B) diseconomies of scale because average total cost is rising as output rises. 
C) economies of scale because total cost is rising as output rises. 
D) economies of scale because average total cost is falling as output rises.

Question 11

Scenario 13-18
Farmer Jack is a watermelon farmer. If Jack plants no seeds on his farm, he gets no harvest. If he plants 1 bag of seeds, he gets 30 watermelons. If he plants 2 bags of seeds, he gets 50 watermelons. If he plants 3 bags of seeds he gets 60 watermelons. A bag of seeds costs $100, and the costs of seeds are his only costs.
-Refer to Scenario 13-18. Which of the following statements is (are) true? (i)
Farmer Jack experiences decreasing marginal product.
(ii)
Farmer Jack's production function is nonlinear.
(iii)
Farmer Jack's total cost curve is linear.

Accepted Answer

A) (i) only 
B) (i) and (ii) only 
C) (ii) only 
D) (i) and (iii) only 
A) (i) only 
B) (i) and (ii) only 
C) (ii) only 
D) (i) and (iii) only

Question 12

Table 13-15  
-Refer to Table 13-15. What is average variable cost when output is 50 units?

Accepted Answer

A) $3.60 
B) $4.00 
C) $4.40 
D) $4.80 
A) $3.60 
B) $4.00 
C) $4.40 
D) $4.80

Question 13

Scenario 13-11
Walter builds birdhouses. He spends $5 on the materials for each birdhouse. He can build one in 30 minutes. He is semi-retired but earns $8 per hour at the local hardware store. He can sell a birdhouse for $20 each.
-Refer to Scenario 13-11. An accountant would calculate the total cost for one birdhouse to be

Accepted Answer

A) $5. 
B) $8. 
C) $9. 
D) $13. 
A) $5. 
B) $8. 
C) $9. 
D) $13.

Question 14

Figure 13-10  
-Refer to Figure 13-10. The three average total cost curves on the diagram labeled ATC1, ATC2, and ATC3 most likely correspond to three different

Accepted Answer

A) time horizons. 
B) products. 
C) firms. 
D) factory sizes. 
A) time horizons. 
B) products. 
C) firms. 
D) factory sizes.

Question 15

Table 13-7
The Flying Elvis Copter Rides  
-Refer to Table 13-7. What is the value of F?

Accepted Answer

A) $50 
B) $100 
C) $150 
D) $200 
A) $50 
B) $100 
C) $150 
D) $200

Question 16

The nature of a firm's cost (fixed or variable) depends on the

Accepted Answer

A) firm's revenues. 
B) time horizon under consideration. 
C) price the firm charges for output. 
D) explicit but not implicit costs. 
A) firm's revenues. 
B) time horizon under consideration. 
C) price the firm charges for output. 
D) explicit but not implicit costs.

Question 17

Table 13-18  
-Refer to Table 13-18. What is the marginal product of the sixth worker?

Accepted Answer

Total output of four workers =

Question 18

​Tony's Taco Truck has an average variable cost of $1.50 and a marginal cost of $2 when it produces 50 units of output (tacos). We can conclude that the average variable cost of producing 51 tacos is

Accepted Answer

A) ​higher than $1.50. 
B) ​lower than $1.50. 
C) ​equal to $1.50. 
D) ​either higher or lower than $1.50 depending on the direction of the marginal cost curve. 
A) ​higher than $1.50. 
B) ​lower than $1.50. 
C) ​equal to $1.50. 
D) ​either higher or lower than $1.50 depending on the direction of the marginal cost curve.

Question 19

Chloe's Café sells gourmet cinnamon rolls. In the long run, the café incurs a total cost of $500 to produce 1,000 cinnamon rolls. If Chloe's Café exhibits constant returns to scale between 1,000 and 1,500 cinnamon rolls, the long-run average total cost for 1,250 cinnamon rolls is

Accepted Answer

A) ​higher than $0.50. 
B) ​lower than $0.50. 
C) ​equal to $0.50. 
D) ​equal to $500. 
A) ​higher than $0.50. 
B) ​lower than $0.50. 
C) ​equal to $0.50. 
D) ​equal to $500.

Question 20

Scenario 13-6
Ziva is an organic lettuce farmer, but she also spends part of her day as a professional organizing consultant. As a consultant, Ziva helps people organize their houses. Due to the popularity of her home-organization services, Farmer Ziva has more clients requesting her services than she has time to help if she maintains her farming business. Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce.
-Refer to Scenario 13-6. Ziva's accountant would calculate the total cost for the day of farming to equal

Accepted Answer

A) $25. 
B) $130. 
C) $300. 
D) $380. 
A) $25. 
B) $130. 
C) $300. 
D) $380.

Table 13-7 -Refer to Table 13-7. At which number of workers does diminishing marginal product begin?

Jaxon borrows $10,000 from a bank and withdraws $20,000 from his personal savings to open a tattoo parlor. The interest rate is 3 percent for both the bank loan and his personal savings. Jaxon's implicit costs are $900.

The marginal product of an input in the production process is the increase in

Fixed costs can be defined as costs that

The amount of money that a wheat farmer could have earned if he had planted barley instead of wheat is

The marginal-cost curve intersects the average-total-cost curve at the output level where average fixed costs are zero.

Table 13-17 Consider the following table of long-run total cost for four different firms: -Refer to Table 13-17. Which firm has economies of scale and then diseconomies of scale as output increases from 1 to 7?

In the long run,

The graph of the production function plots total cost versus quantity of output.

In the long run a company that produces and sells organic tofu incurs total costs of $1,200 when output is 1,200 units and $1,650 when output is 1,400 units. The tofu company exhibits

Table 13-15 -Refer to Table 13-15. What is average variable cost when output is 50 units?

Figure 13-10 -Refer to Figure 13-10. The three average total cost curves on the diagram labeled ATC₁, ATC₂, and ATC₃ most likely correspond to three different

Table 13-7 The Flying Elvis Copter Rides -Refer to Table 13-7. What is the value of F?

The nature of a firm's cost (fixed or variable) depends on the

Table 13-18 -Refer to Table 13-18. What is the marginal product of the sixth worker?

Tony's Taco Truck has an average variable cost of $1.50 and a marginal cost of $2 when it produces 50 units of output (tacos). We can conclude that the average variable cost of producing 51 tacos is

Chloe's Café sells gourmet cinnamon rolls. In the long run, the café incurs a total cost of $500 to produce 1,000 cinnamon rolls. If Chloe's Café exhibits constant returns to scale between 1,000 and 1,500 cinnamon rolls, the long-run average total cost for 1,250 cinnamon rolls is

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters

Exam 13: The Costs of Production

​​​Table 13-7 -Refer to Table 13-7. At which number of workers does diminishing marginal product begin?

Jaxon borrows $10,000 from a bank and withdraws $20,000 from his personal savings to open a tattoo parlor. The interest rate is 3 percent for both the bank loan and his personal savings. Jaxon's implicit costs are $900. ​

The marginal product of an input in the production process is the increase in

Fixed costs can be defined as costs that

The amount of money that a wheat farmer could have earned if he had planted barley instead of wheat is

The marginal-cost curve intersects the average-total-cost curve at the output level where average fixed costs are zero.

Table 13-17 Consider the following table of long-run total cost for four different firms: -Refer to Table 13-17. Which firm has economies of scale and then diseconomies of scale as output increases from 1 to 7?

In the long run,

The graph of the production function plots total cost versus quantity of output.

In the long run a company that produces and sells organic tofu incurs total costs of $1,200 when output is 1,200 units and $1,650 when output is 1,400 units. The tofu company exhibits

Table 13-15 -Refer to Table 13-15. What is average variable cost when output is 50 units?

Figure 13-10 -Refer to Figure 13-10. The three average total cost curves on the diagram labeled ATC1, ATC2, and ATC3 most likely correspond to three different

Table 13-7 The Flying Elvis Copter Rides -Refer to Table 13-7. What is the value of F?

The nature of a firm's cost (fixed or variable) depends on the

Table 13-18 -Refer to Table 13-18. What is the marginal product of the sixth worker?

​Tony's Taco Truck has an average variable cost of $1.50 and a marginal cost of $2 when it produces 50 units of output (tacos). We can conclude that the average variable cost of producing 51 tacos is

Chloe's Café sells gourmet cinnamon rolls. In the long run, the café incurs a total cost of $500 to produce 1,000 cinnamon rolls. If Chloe's Café exhibits constant returns to scale between 1,000 and 1,500 cinnamon rolls, the long-run average total cost for 1,250 cinnamon rolls is

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: The Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

Firms in Competitive Markets

Monopoly

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers in Microeconomics

Filters

Table 13-7 -Refer to Table 13-7. At which number of workers does diminishing marginal product begin?

Jaxon borrows $10,000 from a bank and withdraws $20,000 from his personal savings to open a tattoo parlor. The interest rate is 3 percent for both the bank loan and his personal savings. Jaxon's implicit costs are $900.

Figure 13-10 -Refer to Figure 13-10. The three average total cost curves on the diagram labeled ATC₁, ATC₂, and ATC₃ most likely correspond to three different

Tony's Taco Truck has an average variable cost of $1.50 and a marginal cost of $2 when it produces 50 units of output (tacos). We can conclude that the average variable cost of producing 51 tacos is