Exam 8: Technology, production, and Costs

Table 8-7 Quantity of Lanterns Fixed Cost (dollars) Variable Cost (dollars) Total Cost (dollars) Average Total Cost (dollars) 75 200 170 370 4.93 80 200 230 430 5.36 90 200 7.67 100 200 810 115 200 11.8 117 200 1264 1464 12.5 120 200 1480 Table 8-7 shows cost data for Lotus Lanterns, a producer of whimsical night lights. -Refer to Table 8-7.What is the variable cost of production when the firm produces 115 lanterns?

Table 8-6 Quantity of Quantity of foot morkers Fixed massages per day Variable cost Cost cost Average total cost cost cosinal 0 0 1 10 2 25 3 45 4 60 5 70 -Refer to Table 8-6.Alicia Gregory owns a foot massage business.She leases 4 computer-controlled massage booths,for which she pays $125 per day.She cannot increase the number machines she leases without giving the manufacturer 3 months notice.She can hire as many workers as she wants at a cost of $75 per day per worker.These are the only two inputs she uses in her business.Use this information to fill in the columns in the above table.

Gertrude Stork's Chocolate Shoppe normally employs 4 workers.When the Chocolate Shoppe hired a 5th worker the Shoppe's total output decreased.Therefore

Which of the following statements is true?

Red Stone Creamery currently hires 5 workers.When it added a 6th worker,its output actually fell.Which of the following statements is true?

The change in a firm's total cost from producing one more unit of a good or service is

Ford Motor Company started producing the Model A at plants scattered around the United States

Jill Johnson owns a pizzeria.She currently produces 10,000 pizzas per month at a total cost of $500.If she produced one more pizza her total cost rises to $500.11.What does this tell us about Jill's marginal cost of producing pizzas?

What is minimum efficient scale? What is likely to happen in the long run to firms that do not reach minimum efficient scale?

Minimum efficient scale is defined as the level of output at which the short-run average total cost stops decreasing.

Economies of scale occur when

What is the difference between between total costs,variable costs,and fixed costs?

The process a firm uses to turn inputs into outputs of goods and services is called technology.

Table 8-1 Number of Workers Mushrooms per Day (pounds) 1 12 2 30 3 45 4 50 5 54 6 56 Table 8-1 shows the technology of production at the Matsuko's Mushroom Farm for the month of May. -Refer to Table 8-1.What is the average product of labor when the farm hires 5 workers?

After Suzie,owner of Suzie's Sweet Shop,hires her 8th worker the average product of labor declines.Which of the following statements must be true?

Damian owns a tattoo parlor and has hired three tattoo artists to work for him.The marginal product of labor is 8 for the first artist,12 for the second artist,and 7 for the third artist.What is Damian's average product of labor for these three tattoo artists?

Average total cost is equal to

Figure 8-1 -Refer to Figure 8-1.In a diagram that shows the marginal product of labor on the vertical axis and labor on the horizontal axis,the marginal product curve

Average fixed cost is equal to

A firm has successfully adopted a positive technological change when