Exam 11: Technology, Production, and Costs

Which of the following would be categorized as an implicit cost? A.not being able to spend your $10,000 savings if you sink the money in your business B.the cost of purchasing supplies for your house-cleaning business C.the cost of purchasing auto insurance for your dry-cleaning delivery business

One reason why, in the short run, the marginal product of labor might increase initially as more workers are hired is that

Vipsana's Gyros House sells gyros.The cost of ingredients (pita, meat, spices, etc.)to make a gyro is $2.00.Vipsana pays her employees $60 per day.She also incurs a fixed cost of $120 per day.Calculate Vipsana's variable cost per day when she produces 50 gyros using two workers?

Which of the following costs will not change as output changes?

Costs that change as output changes are called incremental costs.

Jayanthi moves her yoga studio from her home to a space she rents in Oakland, California.Holding everything else constant, as a result of this move

What is the difference between "diminishing marginal returns" and "diseconomies of scale"?

Figure 11-10 -Refer to Figure 11-10.Identify the minimum efficient scale of production.

In the short run, changes in output can only be brought about by a change in the quantity of variable inputs.

If a firm experiences positive technological change, it is able to produce more output using the same inputs.

The marginal cost curve is U-shaped because of the law of increasing opportunity costs.

Average fixed cost is equal to

When the marginal product of labor rises,

You own a business that answers telephone calls for physicians after their offices close.You have an incentive to substitute capital for labor if the

In the short run, if the marginal product is at its maximum, then the

The difference between technology and technological change is that

Figure 11-6 Figure 11-6 contains information about the short-run cost structure of a firm. -Refer to Figure 11-6.In the figure above, which letter represents the average variable cost curve?

Which of the following can a firm do in the long run but not in the short run?

The law of diminishing marginal returns

Suppose two countries use different combinations of inputs, such as labor and capital, to produce the same product.This implies any one of the following except that