Exam 13: The Costs of Production.

Scenario 13-10 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 13-10.The explicit cost for one birdhouse is

Average total cost is very high when a small amount of output is produced because

Johnny is a sophomore in college and has a 1.5 cumulative grade point average (GPA).Johnny's cumulative GPA will fall even further next semester if he performs worse than (i)his cumulative GPA. (ii)he ever performed before. (iii)he did last semester.

Scenario 13-17 Suppose that a given firm experiences decreasing marginal product of labor with the addition of each worker regardless of the current output level. -Refer to Scenario 13-17.Marginal cost will be

Figure 13-1 -Refer to Figure 13-1.Which of the following could explain why the total product curve would shift from TP2 to TP1?

Diseconomies of scale occur when

Which of the following expressions is correct?

Table 13-15 Consider the following table of long-run total cost for four different firms: -Refer to Table 13-13.Which firm has constant returns to scale over the entire range of output?

Scenario 13-1 Calvin wants to start his own business making candles. He can purchase a candle factory that costs $400,000. Calvin currently has $500,000 in the bank earning 3 percent interest per year. -Refer to Scenario 13-1.Suppose Calvin purchases the factory using $200,000 of his own money and $200,000 borrowed from a bank at an interest rate of 6 percent.What is Calvin's annual opportunity cost of purchasing the factory?

Marginal cost is equal to average total cost when

Billy's Bean Bag Emporium produced 300 bean bag chairs but sold only 275 of the units it produced.The average cost of production for each unit of output produced was $100.The price for each of the 275 units sold was $95.Total profit for Billy's Bean Bag Emporium would be

Table 13-3 -Refer to Table 13-3.The marginal product of the fourth worker is

For a firm,the relationship between the quantity of inputs and quantity of output is called the

Table 13-12 Betty's Bakery -Refer to Table 13-12.What is the total cost of producing 2 cakes at Betty's Bakery?

Average total cost is equal to

Figure 13-7 -Refer to Figure 13-7.Which of the figures represents the production function for a typical firm?

Table 13-12 Betty's Bakery -Refer to Table 13-12.What is the average variable cost of producing 3 cakes at Betty's Bakery?

The average-total-cost curve intersects

Table 13-2 -Refer to Table 13-2.At which number of workers does diminishing marginal product begin?

Table 13-2 -Refer to Table 13-2.What is the marginal product of the first worker?