Exam 6: Production Costs

Suppose that a small business takes in monthly revenue of $100,000.Labor,rental,energy,and other purchased input costs are $70,000.The owner/entrepreneur could earn $5,000 per month in another job,and the owner/entrepreneur could get a return of $5,000 each month if she sold her business and invested the net proceeds in a financial asset,such as a treasury bond.Which of the following correctly describes her monthly economic profit?

Use the table below to answer the following question. Units of Output Total Fixed Cost (dollars) Total Variable Cost (dollars) 1 1,000 1,200 2 1,000 2,400 3 1,000 3,600 4 1,000 5,000 5 1,000 6,600 What is the average total cost at an output level of four units?

Exhibit 6-13 Cost curves -In Exhibit 13,TFC is shown by the graph labeled:

Which of the following are implicit costs for a typical firm?

Which of the following represents the key difference between the short run and the long run?

Total fixed costs are costs that are fixed with respect to:

Exhibit 6-11 Short-run cost curves schedule for pizzeria's hourly production -In Exhibit 6-11,the average total cost or producing 40 pizzas per hour is equal to:

The minimum point on the marginal cost curve corresponds to the:

Exhibit 6-5 Workers and output data -In Exhibit 6-5,diminishing returns set in when the ____ worker is hired.

For a typical firm,the long-run average total cost curve:

Exhibit 6-14 Cost curves -In Exhibit 6-14,constant returns to scale only exist for output levels between:

Economies of scale are created by greater efficiency of capital and by:

The increase in total output that results from a unit increase in one unit of a variable input is equal to the input's:

Which of the following is true if the total variable cost curve is rising?

Exhibit 6-12 Cost schedule for producing pizza -By filling in the blanks in Exhibit 6-12,the AVC of 4 pizzas is shown to be equal to:

If a firm's long-run average cost curve is rising,it is experiencing:

The total cost curve is the sum of the:

An economist left his $100,000-a-year teaching position to work full-time in his own consulting business.In the first year,he had total revenue of $200,000 and business expenses of $150,000.She made a(n):

Diseconomies of scale cause the short-run marginal cost curve to slope upwards.

If total cost is $1,000 when output is zero,and total cost is $1,200 when output is one,and total cost is $1,500 when output is two,then which of the following is true?