Exam 6: Sellers and Incentives

The following table shows the total output produced by different numbers of workers in a shoe factory. -Refer to the table above.If the factory plans to hire a seventh worker whose marginal product is 15 pairs,the total output after he is hired will be ________.

The following figure depicts a firm's long-run average total cost and selected short-run average total cost curves. -Refer to the figure above.If this firm is producing at point B,we could say that it ________.

Scenario: Jenna makes homemade pastries. Her fixed input in the short run is the mixer. In the long run, she can choose a spatula, hand mixer, or a stand mixer. The following table shows the short-run fixed cost (F.Cand variable cost (VC) of weekly production using each different level of the capital input. -Refer to the scenario above.If Jenna wants to make 100 pastries per week,which level of capital input should she choose?

The following table shows the total output, variable costs, fixed costs, total costs, average total costs, and marginal costs of a firm, with some cells in the table intentionally left blank. -Refer to the table above.What is the variable cost of producing 17 units of output?

Firms in a perfectly competitive industry earn zero profits in the long run because ________.

The following figure shows the supply curve,S₁ ,of a firm that manufactures cell phones. a)Calculate the firm's producer surplus when the price of one cell phone is $60. b)If the price of cell phones increases to $100 per unit,what happens to producer surplus? c)Suppose a fall in the price of inputs shifts the supply curve of the firm from S₁ to S₂.Calculate the new producer surplus at a price of $60 per unit.

When the marginal product ________,the marginal cost ________.

Scenario: The figure below shows the supply and the demand for a good (left) and the cost curves of an individual firm in this market (right). Initially, all firms in this market have identical cost curves MC₁ and ATC₁, and the market is in equilibrium at point A. Subsequently, a new production technology has been developed for this product. Some of the existing firms as well as some new firms have adopted the new technology, and their cost curves are MC₂ and ATC₂. -Refer to the figure above.Suppose that,due to firm entries,the supply curve has shifted so that the equilibrium price falls to $2.00.Then ________.

Scenario: David runs a janitorial service company. The following table shows the total number of rooms that can be cleaned by the specified number of workers and industrial vacuum cleaners. -Refer to the scenario above.The variable input in this janitorial service is ________,and the fixed input is ________.

The following figure depicts the marginal cost curve, the average total curve, and the average variable cost curve of a certain firm. -Refer to the figure above.What is the price on the market when the firm makes a profit of -$3,00?

Define the terms "production" and "production function." Differentiate between the short run and the long run based on the usage of inputs by a firm.

If the supply of a good is unit-elastic,then a 50 percent increase in the price of the good will result in a ________ in quantity supplied.

The following table shows the total output, number of workers employed, variable costs, and fixed costs of a firm. -Refer to the table above.What is the firm's marginal cost per unit of output when it produces the 155th unit of the good?

Scenario: A car repair shop hires workers and pays them the federal minimum wage of $7.25. The following table shows the marginal returns to each worker in terms of number of cars repaired. -Refer to the scenario above.In addition,suppose the fixed cost of operating this shop is $1,000 per day.If we calculate the marginal cost of this firm,we expect it to be ________.

The entry of new firms into an existing market causes ________.

The following graph shows the short-run production function of a firm. -Refer to the graph above.When do we observe a negative return to inputs?

Which of the following relationships correctly identifies the profit-maximizing condition of a firm that sells a divisible good in a perfectly competitive market?

The following table shows the total output, number of workers employed, variable costs, and fixed costs of a firm. -Refer to the table above.When the ________ is employed,diminishing marginal returns set in.

A supply curve shows the relationship between ________.

When the marginal cost curve lies above the average cost curve,________.