Question 1

Use the table Workers and Croissants Produced. What is the marginal product of labor of the fourth worker?

Accepted Answer

A)  420 
B)  70 
C)  105 
D)  80 
A)  420 
B)  70 
C)  105 
D)  80

Question 2

The output that corresponds to the lowest point on the long-run average total cost curve is known as:

Accepted Answer

A)  minimum total efficiency. 
B)  maximum average fixed cost. 
C)  minimum efficient scale. 
D)  maximum marginal product. 
A)  minimum total efficiency. 
B)  maximum average fixed cost. 
C)  minimum efficient scale. 
D)  maximum marginal product.

Question 3

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. In a graph of Eleanor's marginal cost and average total cost, the marginal cost curve intersects the average total cost curve at a quantity:

Accepted Answer

A)  of zero. 
B)  greater than 4. 
C)  less than 4. 
D)  of 4. 
A)  of zero. 
B)  greater than 4. 
C)  less than 4. 
D)  of 4.

Question 4

Evelyn's Orchard currently produces 5,000 gallons of cider. The marginal cost of the 5,000th gallon was $3, and the average total cost of the 5,000th gallon was $1.50. What can be concluded based on this information?

Accepted Answer

A)  Evelyn's Orchard's marginal product of labor is increasing at 5,000 gallons. 
B)  If Evelyn's Orchard produces one more gallon, marginal cost and average total cost will be closer to zero. 
C)  Producing one more gallon will make the difference between marginal cost and average total cost smaller. 
D)  The quantity where marginal cost equals average total cost is less than 5,000 gallons. 
A)  Evelyn's Orchard's marginal product of labor is increasing at 5,000 gallons. 
B)  If Evelyn's Orchard produces one more gallon, marginal cost and average total cost will be closer to zero. 
C)  Producing one more gallon will make the difference between marginal cost and average total cost smaller. 
D)  The quantity where marginal cost equals average total cost is less than 5,000 gallons.

Question 5

Why does the marginal product of labor at first increase but eventually decrease as more units of labor are added?

Accepted Answer

Initially, as more labor is ad

Question 6

X and Y are inputs used to produce good Z. If another unit of X increases but the units of Y are constant, then what is true according to the law of diminishing marginal returns?

Accepted Answer

A)  The total amount of Z decreases. 
B)  The marginal product of Y increases. 
C)  The marginal product of Z decreases. 
D)  The marginal product of X decreases. 
A)  The total amount of Z decreases. 
B)  The marginal product of Y increases. 
C)  The marginal product of Z decreases. 
D)  The marginal product of X decreases.

Question 7

During the back-to-school shopping season, a large store hires extra workers to work the 20 cash registers in the store. What are the variable inputs in this situation?

Accepted Answer

A)  workers 
B)  cash registers 
C)  workers and cash registers 
D)  neither workers nor cash registers 
A)  workers 
B)  cash registers 
C)  workers and cash registers 
D)  neither workers nor cash registers

Question 8

The cost of any amount of output is minimized when the:

Accepted Answer

A)  marginal product per dollar spent is the same for all inputs. 
B)  total product per dollar spent is the same for all inputs. 
C)  average product per dollar spent is the same for all inputs. 
D)  difference between the additional production of two goods is equal. 
A)  marginal product per dollar spent is the same for all inputs. 
B)  total product per dollar spent is the same for all inputs. 
C)  average product per dollar spent is the same for all inputs. 
D)  difference between the additional production of two goods is equal.

Question 9

In the long run, a firm is producing at minimum efficient scale when:

Accepted Answer

A)  marginal cost is at its lowest. 
B)  increasing or decreasing output will increase average total cost. 
C)  the fixed cost curve is at its lowest point. 
D)  variable costs equal zero. 
A)  marginal cost is at its lowest. 
B)  increasing or decreasing output will increase average total cost. 
C)  the fixed cost curve is at its lowest point. 
D)  variable costs equal zero.

Question 10

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. What is true if she can sell four swings for $3,000?

Accepted Answer

A)  She is making a profit. 
B)  Her marginal product of labor is decreasing at the fourth swing. 
C)  Her average total cost is $150. 
D)  Her marginal cost is greater than her variable cost. 
A)  She is making a profit. 
B)  Her marginal product of labor is decreasing at the fourth swing. 
C)  Her average total cost is $150. 
D)  Her marginal cost is greater than her variable cost.

Question 11

Total cost divided by the quantity of output is a firm's _____ cost.

Accepted Answer

A)  average variable 
B)  fixed 
C)  marginal 
D)  average total 
A)  average variable 
B)  fixed 
C)  marginal 
D)  average total

Question 12

The smallest quantity at which a firm's long-run average total cost is minimized is the:

Accepted Answer

A)  profit-maximizing quantity. 
B)  minimum efficient scale. 
C)  profit-minimizing quantity 
D)  diseconomies of scale. 
A)  profit-maximizing quantity. 
B)  minimum efficient scale. 
C)  profit-minimizing quantity 
D)  diseconomies of scale.

Question 13

What cost cannot be changed in the short run?

Accepted Answer

A)  marginal cost 
B)  variable cost 
C)  fixed cost 
D)  average variable cost 
A)  marginal cost 
B)  variable cost 
C)  fixed cost 
D)  average variable cost

Question 14

What is an implicit cost?

Accepted Answer

A)  the cost of a typical unit of production 
B)  a cost that does not involve a direct outlay of money 
C)  a cost that requires an outlay of money 
D)  the cost of one more unit of production 
A)  the cost of a typical unit of production 
B)  a cost that does not involve a direct outlay of money 
C)  a cost that requires an outlay of money 
D)  the cost of one more unit of production

Question 15

Why are all costs variable costs in the long run?

Accepted Answer

Variable costs are costs that

Question 16

How is economic profit calculated?

Accepted Answer

A)  Total revenue - Total explicit costs 
B)  Total revenue - Total implicit costs 
C)  Total revenue - (Total explicit costs + Total implicit costs) 
D)  Total revenue - (Total explicit costs + Total implicit costs) - Total average costs 
A)  Total revenue - Total explicit costs 
B)  Total revenue - Total implicit costs 
C)  Total revenue - (Total explicit costs + Total implicit costs) 
D)  Total revenue - (Total explicit costs + Total implicit costs) - Total average costs

Question 17

A _____ cost is a cost that has already been paid and cannot be recovered.

Accepted Answer

A)  marginal 
B)  variable 
C)  fixed 
D)  sunk 
A)  marginal 
B)  variable 
C)  fixed 
D)  sunk

Question 18

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. What column represents Eleanor's fixed costs?
​

Accepted Answer

A)  A 
B)  B 
C)  C 
D)  D 
A)  A 
B)  B 
C)  C 
D)  D

Question 19

The lowest point on the average total cost curve is where the marginal cost of producing one:

Accepted Answer

A)  more of a good pulls down average total cost due to decreasing marginal costs. 
B)  less of a good pulls down average total cost. 
C)  more of a good switches from pulling down average total cost to pulling up average total cost. 
D)  more of a good drives up average total cost. 
A)  more of a good pulls down average total cost due to decreasing marginal costs. 
B)  less of a good pulls down average total cost. 
C)  more of a good switches from pulling down average total cost to pulling up average total cost. 
D)  more of a good drives up average total cost.

Question 20

Use the table Workers and Croissants Produced. At what quantity of workers is the marginal product the highest?

Accepted Answer

A)  one worker 
B)  two workers 
C)  four workers 
D)  five workers 
A)  one worker 
B)  two workers 
C)  four workers 
D)  five workers

Use the table Workers and Croissants Produced. What is the marginal product of labor of the fourth worker?

The output that corresponds to the lowest point on the long-run average total cost curve is known as:

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. In a graph of Eleanor's marginal cost and average total cost, the marginal cost curve intersects the average total cost curve at a quantity:

Evelyn's Orchard currently produces 5,000 gallons of cider. The marginal cost of the 5,000th gallon was $3, and the average total cost of the 5,000th gallon was $1.50. What can be concluded based on this information?

Why does the marginal product of labor at first increase but eventually decrease as more units of labor are added?

X and Y are inputs used to produce good Z. If another unit of X increases but the units of Y are constant, then what is true according to the law of diminishing marginal returns?

During the back-to-school shopping season, a large store hires extra workers to work the 20 cash registers in the store. What are the variable inputs in this situation?

The cost of any amount of output is minimized when the:

In the long run, a firm is producing at minimum efficient scale when:

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. What is true if she can sell four swings for $3,000?

Total cost divided by the quantity of output is a firm's _____ cost.

The smallest quantity at which a firm's long-run average total cost is minimized is the:

What cost cannot be changed in the short run?

What is an implicit cost?

Why are all costs variable costs in the long run?

How is economic profit calculated?

A _____ cost is a cost that has already been paid and cannot be recovered.

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. What column represents Eleanor's fixed costs?

The lowest point on the average total cost curve is where the marginal cost of producing one:

Use the table Workers and Croissants Produced. At what quantity of workers is the marginal product the highest?

Foundations of Economics

Extension: Understanding Graphs

Markets and Economies

Demand

Supply

Market Equilibrium

Elasticity

Consumer Behavior

Perfect Competition

Market Power

Factor Markets

Market Failure and Government Failure

Measuring an Economys Performance

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and Banking

Monetary Policy

Economic Growth and Development

International Trade and Finance

Filters

Exam 8: Production Costs

Use the table Workers and Croissants Produced. What is the marginal product of labor of the fourth worker?

The output that corresponds to the lowest point on the long-run average total cost curve is known as:

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. In a graph of Eleanor's marginal cost and average total cost, the marginal cost curve intersects the average total cost curve at a quantity:

Evelyn's Orchard currently produces 5,000 gallons of cider. The marginal cost of the 5,000th gallon was $3, and the average total cost of the 5,000th gallon was $1.50. What can be concluded based on this information?

Why does the marginal product of labor at first increase but eventually decrease as more units of labor are added?

X and Y are inputs used to produce good Z. If another unit of X increases but the units of Y are constant, then what is true according to the law of diminishing marginal returns?

During the back-to-school shopping season, a large store hires extra workers to work the 20 cash registers in the store. What are the variable inputs in this situation?

The cost of any amount of output is minimized when the:

In the long run, a firm is producing at minimum efficient scale when:

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. What is true if she can sell four swings for $3,000?

Total cost divided by the quantity of output is a firm's _____ cost.

The smallest quantity at which a firm's long-run average total cost is minimized is the:

What cost cannot be changed in the short run?

What is an implicit cost?

Why are all costs variable costs in the long run?

How is economic profit calculated?

A _____ cost is a cost that has already been paid and cannot be recovered.

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. What column represents Eleanor's fixed costs? ​

The lowest point on the average total cost curve is where the marginal cost of producing one:

Use the table Workers and Croissants Produced. At what quantity of workers is the marginal product the highest?

Foundations of Economics

Extension: Understanding Graphs

Markets and Economies

Demand

Supply

Market Equilibrium

Elasticity

Consumer Behavior

Perfect Competition

Market Power

Factor Markets

Market Failure and Government Failure

Measuring an Economys Performance

Aggregate Demand and Aggregate Supply

Fiscal Policy

Money and Banking

Monetary Policy

Economic Growth and Development

International Trade and Finance

Filters

Use the table The Cost of Swing Sets. Eleanor's costs of producing swing sets are given in this table, but the labels for several columns are missing. What column represents Eleanor's fixed costs?