Exam 13: The Costs of Production.

Scenario 13-13 Joan grows pumpkins. If Joan plants no seeds on her farm, she gets no harvest. If she plants 1 bag of seeds, she gets 500 pumpkins. If she plants 2 bags, she gets 800 pumpkins. If she plants 3 bags, she gets 900 pumpkins. A bag of seeds costs $100, and seeds are her only cost. -Refer to Scenario 13-13.Joan's total-cost curve is

Diminishing marginal productivity implies decreasing total product.

Table 13-12 Betty's Bakery -Refer to Table 13-12.What is the marginal cost of the 2nd cake at Betty's Bakery?

Economists normally assume that the goal of a firm is to earn (i)profits as large as possible,even if it means reducing output. (ii)profits as large as possible,even if it means incurring a higher total cost. (iii)revenues as large as possible,even if it reduces profits.

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

Table 13-12 Betty's Bakery -Refer to Table 13-12.What is the variable cost of producing 5 cakes at Betty's Bakery?

When the marginal product of an input declines as the quantity of that input increases,the production function exhibits

Figure 13-9 The figure below depicts average total cost functions for a firm that produces automobiles. -Refer to Figure 13-9.In the long run,the firm can operate on which of the following average total cost curves?

The amount of money that a firm pays to buy inputs is called

Which of the following would be an example of an implicit cost? (i)forgone investment opportunities (ii)wages of workers (iii)raw materials costs

The amount by which total cost rises when the firm produces one additional unit of output is called

The typical total-cost curve is U-shaped.

Which of the following statements is not correct?

Which of the following is an example of an implicit cost? (i)the owner of a firm forgoing an opportunity to earn a large salary working for a Wall Street brokerage firm (ii)interest paid on the firm's debt (iii)rent paid by the firm to lease office space

In the long run Firm A incurs total costs of $1,050 when output is 30 units and $1,200 when output is 40 units.Firm A exhibits

Suppose that a "doggie day care" firm uses only two inputs: hourly workers (labor)and a building (capital).In the short run,the firm most likely considers

A firm has a fixed cost of $700 in its first year of operation.When the firm produces 99 units of output,its total costs are $4,000.The marginal cost of producing the 100th unit of output is $200.What is the total cost of producing 100 units?

Accountants often ignore implicit costs.

Table 13-8 -Refer to Table 13-8.What is the marginal cost of producing the fifth unit of output?

Tom's Tent Company has total fixed costs of $300,000 per year.The firm's average variable cost is $80 for 10,000 tents.At that level of output,the firm's average total costs equal