Question 1

Economies and diseconomies of scale are the reasons why short-run average total cost decreases and then increases.

Accepted Answer

A) True 
 B)False

Question 2

A positively sloped long run average cost implies:

Accepted Answer

A) economies of scale. 
B) constant returns to scale. 
C) diseconomies of scale. 
D) diminishing marginal returns to a factor. 
E) increasing returns to scale. 
A) economies of scale. 
B) constant returns to scale. 
C) diseconomies of scale. 
D) diminishing marginal returns to a factor. 
E) increasing returns to scale.

Question 3

If the total cost of producing 2 pounds of cheese is $6 and the total cost of producing 4 pounds of cheese is $8,then:

Accepted Answer

A) total cost is declining. 
B) average total cost is declining. 
C) average total cost is increasing. 
D) average total cost is constant. 
E) total cost is constant. 
A) total cost is declining. 
B) average total cost is declining. 
C) average total cost is increasing. 
D) average total cost is constant. 
E) total cost is constant.

Question 4

"As I add more workers to the factory line,the additional output produced by each additional worker seems to decline.Eventually,the workers just get in each others' way." This statement by a factory supervisor refers to:

Accepted Answer

A) the law of comparative advantage. 
B) the law of demand. 
C) the law of supply. 
D) the law of diminishing marginal utility. 
E) the law of diminishing marginal returns. 
A) the law of comparative advantage. 
B) the law of demand. 
C) the law of supply. 
D) the law of diminishing marginal utility. 
E) the law of diminishing marginal returns.

Question 5

Short run refers to a period of time during which:

Accepted Answer

A) all the factors are constant. 
B) all the factors are variable. 
C) the producer can shift from one plant size to another. 
D) some factors are fixed while some others are variable. 
E) the producer cannot change the level of output. 
A) all the factors are constant. 
B) all the factors are variable. 
C) the producer can shift from one plant size to another. 
D) some factors are fixed while some others are variable. 
E) the producer cannot change the level of output.

Question 6

In the long run,total cost is equal to total fixed cost at an output of zero.

Accepted Answer

A) True 
 B)False

Economies and diseconomies of scale are the reasons why short-run average total cost decreases and then increases.

A positively sloped long run average cost implies:

If the total cost of producing 2 pounds of cheese is $6 and the total cost of producing 4 pounds of cheese is $8,then:

"As I add more workers to the factory line,the additional output produced by each additional worker seems to decline.Eventually,the workers just get in each others' way." This statement by a factory supervisor refers to:

Short run refers to a period of time during which:

In the long run,total cost is equal to total fixed cost at an output of zero.

Economics: The World Around You

Choice, opportunity Costs, and Specialization

Markets, Demand and Supply, and the Price System

The Market System and the Private and Public Sector

Elasticity: Demand and Supply

Consumer Choice

Profit Maximization

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Antitrust and Regulation

Market Failures, Government Failures, and Rent Seeking

Resource Markets

The Labor Market

Capital Markets

The Land Market and Natural Resources

Aging, Social Security and Health Care

Income Distribution,Poverty and Government Policy

World Trade Equilibrium

International Trade Restrictions

Exchange Rates and Financial Links Between Countries

Filters

Exam 7: Supply: The Costs of Doing Business

Economies and diseconomies of scale are the reasons why short-run average total cost decreases and then increases.

A positively sloped long run average cost implies:

If the total cost of producing 2 pounds of cheese is $6 and the total cost of producing 4 pounds of cheese is $8,then:

"As I add more workers to the factory line,the additional output produced by each additional worker seems to decline.Eventually,the workers just get in each others' way." This statement by a factory supervisor refers to:

Short run refers to a period of time during which:

In the long run,total cost is equal to total fixed cost at an output of zero.

Economics: The World Around You

Choice, opportunity Costs, and Specialization

Markets, Demand and Supply, and the Price System

The Market System and the Private and Public Sector

Elasticity: Demand and Supply

Consumer Choice

Profit Maximization

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Antitrust and Regulation

Market Failures, Government Failures, and Rent Seeking

Resource Markets

The Labor Market

Capital Markets

The Land Market and Natural Resources

Aging, Social Security and Health Care

Income Distribution,Poverty and Government Policy

World Trade Equilibrium

International Trade Restrictions

Exchange Rates and Financial Links Between Countries

Filters