Question 1

In economics,technology only refers to the development of new products.

Accepted Answer

A) True 
 B)False

Question 2

Figure 8-8
  
-Refer to Figure 8-8 above to answer the following questions.
a.Identify the curves in the diagram.
A ________ B ________ C ________
b.What is the numerical value of fixed cost when the quantity of output=10?
c.What is the numerical value of variable cost when the quantity of output=10?
d.What is the numerical value of total cost when the quantity of output =10?
e.What is the numerical value of average fixed cost when the quantity of output =10?
f.What is the numerical value of average total cost when the quantity of output =10?
g.On the graph identify the area that represents the total variable cost of production when the quantity of output =10.
h.On the graph identify the area that represents the fixed cost of production when the quantity of output =10.

Accepted Answer

a∙A=Marginal cost curve; B = A

Question 3

The level of output at which all economies of scale have been exhausted is known as

Accepted Answer

A)  constant returns to scale. 
B)  minimum efficient scale. 
C)  the economically efficient output level. 
D)  optimal economic size. 
A)  constant returns to scale. 
B)  minimum efficient scale. 
C)  the economically efficient output level. 
D)  optimal economic size.

Question 4

Use a long-run average cost curve graph to illustrate how diseconomies of scale would not make it beneficial for two companies to go through with a merger.

Accepted Answer

Assume the two companies are o

Question 5

Which of the following is typically considered a fixed cost by academic book publishers but a variable cost by companies that print books?

Accepted Answer

A)  postage and supplies 
B)  travel 
C)  rent 
D)  wages and salaries 
A)  postage and supplies 
B)  travel 
C)  rent 
D)  wages and salaries

Question 6

Figure 8-1
  
-Refer to Figure 8-1.The marginal product of the 3rd worker is

Accepted Answer

A)  57. 
B)  19. 
C)  15. 
D)  11. 
A)  57. 
B)  19. 
C)  15. 
D)  11.

Question 7

Which of the following is a reason why a firm would experience diseconomies of scale?

Accepted Answer

A)  To finance an increase in the size of its plant a firm must borrow more money or sell more shares of stock. 
B)  As the size of the firm increases, it becomes more difficult to find markets where it doesn't already have operations. 
C)  As the size of the firm increases it becomes more difficult to coordinate the operations of its manufacturing plants. 
D)  As the size of the firm increases, it must operate in other countries where differences in language, customs, and laws increase its average costs. 
A)  To finance an increase in the size of its plant a firm must borrow more money or sell more shares of stock. 
B)  As the size of the firm increases, it becomes more difficult to find markets where it doesn't already have operations. 
C)  As the size of the firm increases it becomes more difficult to coordinate the operations of its manufacturing plants. 
D)  As the size of the firm increases, it must operate in other countries where differences in language, customs, and laws increase its average costs.

Question 8

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?

Accepted Answer

A)  The marginal cost of producing pizzas is constant. 
B)  The marginal cost of producing pizzas is falling. 
C)  The marginal cost of producing pizzas cannot be determined without more information. 
D)  The marginal cost of producing pizzas is rising. 
A)  The marginal cost of producing pizzas is constant. 
B)  The marginal cost of producing pizzas is falling. 
C)  The marginal cost of producing pizzas cannot be determined without more information. 
D)  The marginal cost of producing pizzas is rising.

Question 9

If production displays constant returns to scale,then all economies of scale have been exhausted.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following equations is incorrect?

Accepted Answer

A)  ATC - AFC = AVC 
B)  AVC + AFC = ATC 
C)  AFC = ATC - AVC 
D)  ATC = AVC - AFC 
A)  ATC - AFC = AVC 
B)  AVC + AFC = ATC 
C)  AFC = ATC - AVC 
D)  ATC = AVC - AFC

Question 11

Figure 8-5
  
-Refer to Figure 8-5.Curve G approaches curve F because

Accepted Answer

A)  marginal cost is above average variable costs. 
B)  average fixed cost falls as output rises. 
C)  fixed cost falls as capacity rises. 
D)  total cost falls as more and more is produced. 
A)  marginal cost is above average variable costs. 
B)  average fixed cost falls as output rises. 
C)  fixed cost falls as capacity rises. 
D)  total cost falls as more and more is produced.

Question 12

Stan owns a software design business.He obtained a bank loan to buy computer equipment for his business.He pays $1,000 per month for interest on the loan.He has 10 employees,each of whom is paid $4,000 per month.Because his business has been successful,next month he will increase employee wages to $5,000.If the revenue from his business remains at its current level,Stan is considering an addition to his office.Which of the following statements regarding Stan's business is false?

Accepted Answer

A)  The payments Stan makes to his employees are variable costs and explicit costs. 
B)  The monthly payment Stan makes for his bank loan is an implicit cost. 
C)  The monthly payment Stan makes for his bank loan is a fixed cost. 
D)  The addition Stan is considering to make to his office would be an implicit cost. 
A)  The payments Stan makes to his employees are variable costs and explicit costs. 
B)  The monthly payment Stan makes for his bank loan is an implicit cost. 
C)  The monthly payment Stan makes for his bank loan is a fixed cost. 
D)  The addition Stan is considering to make to his office would be an implicit cost.

Question 13

As output increases,average fixed cost gets smaller and smaller.

Accepted Answer

A) True 
 B)False

Question 14

The total output produced by a firm divided by the quantity of workers employed by the firm is the definition of

Accepted Answer

A)  the marginal product of labor. 
B)  the division of labor. 
C)  the average product of labor. 
D)  the average cost of production. 
A)  the marginal product of labor. 
B)  the division of labor. 
C)  the average product of labor. 
D)  the average cost of production.

In economics,technology only refers to the development of new products.

The level of output at which all economies of scale have been exhausted is known as

Use a long-run average cost curve graph to illustrate how diseconomies of scale would not make it beneficial for two companies to go through with a merger.

Which of the following is typically considered a fixed cost by academic book publishers but a variable cost by companies that print books?

Figure 8-1 -Refer to Figure 8-1.The marginal product of the 3rd worker is

Which of the following is a reason why a firm would experience diseconomies of scale?

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?

If production displays constant returns to scale,then all economies of scale have been exhausted.

Which of the following equations is incorrect?

Figure 8-5 -Refer to Figure 8-5.Curve G approaches curve F because

As output increases,average fixed cost gets smaller and smaller.

The total output produced by a firm divided by the quantity of workers employed by the firm is the definition of

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, The Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, The Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, International Trade, and Exchange Rates

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Exam 8: Technology,Production,and Costs

In economics,technology only refers to the development of new products.

The level of output at which all economies of scale have been exhausted is known as

Use a long-run average cost curve graph to illustrate how diseconomies of scale would not make it beneficial for two companies to go through with a merger.

Which of the following is typically considered a fixed cost by academic book publishers but a variable cost by companies that print books?

Figure 8-1 -Refer to Figure 8-1.The marginal product of the 3rd worker is

Which of the following is a reason why a firm would experience diseconomies of scale?

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?

If production displays constant returns to scale,then all economies of scale have been exhausted.

Which of the following equations is incorrect?

Figure 8-5 -Refer to Figure 8-5.Curve G approaches curve F because

As output increases,average fixed cost gets smaller and smaller.

The total output produced by a firm divided by the quantity of workers employed by the firm is the definition of

Economics: Foundations and Models

Trade-Offs, Comparative Advantage, and the Market System

Where Prices Come From: The Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, The Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, The Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money,Banks,and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, International Trade, and Exchange Rates

Filters