Question 1

-Refer to the graph above to answer this question.Which curve illustrates average fixed cost?

Accepted Answer

A) 1. 
B) 2. 
C) 3. 
D) 4. 
A) 1. 
B) 2. 
C) 3. 
D) 4.

Question 2

"A change in the AVC curve will lead to a change in the ATC curve;therefore,if there is a change in the ATC curve,there must have been a change in the AVC curve." Evaluate this statement.

Accepted Answer

The first part of the statement is corre

Question 3

The data in the table is for a firm in which labour is the only variable cost and each unit of labour costs the same regardless of how many units are bought.
  
-Refer to the information above to answer this question.What is the value of AVC if 3 units of labour are used?

Accepted Answer

A) $1.50. 
B) $5. 
C) $6.67. 
D) $10. 
E) $18.60. 
A) $1.50. 
B) $5. 
C) $6.67. 
D) $10. 
E) $18.60.

Question 4

Below are some production data for Quite Simple Products Ltd.
  
-Refer to the information above to answer this question.How many units of labour are being used when the firm is at its most productive point?

Accepted Answer

A) 1. 
B) 2. 
C) 4. 
D) 5. 
E) 7. 
A) 1. 
B) 2. 
C) 4. 
D) 5. 
E) 7.

Question 5

"Fill in the blank" in the table below and then answering the question below.
  
-Refer to the information above to answer this question.What is marginal cost when output is 4?

Accepted Answer

A) $6. 
B) $9. 
C) $13. 
D) $18. 
E) $22. 
A) $6. 
B) $9. 
C) $13. 
D) $18. 
E) $22.

Question 6

What is the sum of total variable costs and total fixed costs?

Accepted Answer

A) It is equal to the sum of average product and marginal product. 
B) It is the sum of all marginal costs. 
C) It is total cost. 
D) It is AVC times the quantity of output. 
A) It is equal to the sum of average product and marginal product. 
B) It is the sum of all marginal costs. 
C) It is total cost. 
D) It is AVC times the quantity of output.

Question 7

-Refer to the information above to answer this question.What is the value of average total cost at the point of diminishing returns?

Accepted Answer

A) $5. 
B) $8.17. 
C) $8.71. 
D) $10. 
E) Cannot be determined. 
A) $5. 
B) $8.17. 
C) $8.71. 
D) $10. 
E) Cannot be determined.

Question 8

How does the calculation of profit differ between an economist and an accountant?

Accepted Answer

An economist includes both implicit and

Question 9

The data in the table is for a firm in which labour is the only variable cost and each unit of labour costs the same regardless of how many units are bought.
  
-Refer to the information above to answer this question.What are the missing numbers for AP in the fourth column?

Accepted Answer

A) 20,25,20,17.5 and -5. 
B) 20,15,20,17.5 and -5. 
C) 10,15,20,16.9 and 13. 
D) 10,25,25,16.9 and 0. 
E) 10,20,20,17.5 and -5. 
A) 20,25,20,17.5 and -5. 
B) 20,15,20,17.5 and -5. 
C) 10,15,20,16.9 and 13. 
D) 10,25,25,16.9 and 0. 
E) 10,20,20,17.5 and -5.

Question 10

What is the relationship between the AP/MP curves and the AVC/MC curves?

Accepted Answer

They are upside-down images of

Question 11

-What is the term for the increase in total variable costs which results from the production of one more unit of output?

Accepted Answer

A) Marginal cost. 
B) Total variable cost. 
C) Average variable cost. 
D) Total cost. 
A) Marginal cost. 
B) Total variable cost. 
C) Average variable cost. 
D) Total cost.

Question 12

Which of the following are fixed costs (F),and which are variable costs(V)?
a)electricity costs
b)an annual insurance policy
c)overtime pay for production workers
d)property taxes on buildings and land owned by the business

Accepted Answer

a)variable

Question 13

If marginal product is declining,which of the following statements is correct?

Accepted Answer

A) Average product must be falling. 
B) Average product could be rising or falling. 
C) Marginal cost must be falling. 
D) Average variable cost must be rising. 
E) Average variable cost must be falling. 
A) Average product must be falling. 
B) Average product could be rising or falling. 
C) Marginal cost must be falling. 
D) Average variable cost must be rising. 
E) Average variable cost must be falling.

Question 14

What is average variable cost?

Accepted Answer

A) Total fixed cost divided by total output. 
B) Total variable cost divided by total marginal costs. 
C) Total output divided by total variable cost. 
D) Total variable cost divided by total output. 
A) Total fixed cost divided by total output. 
B) Total variable cost divided by total marginal costs. 
C) Total output divided by total variable cost. 
D) Total variable cost divided by total output.

Question 15

What do economists mean by the term "the most productive output"?

Accepted Answer

A) The output where total product is at a maximum. 
B) The output where average product is at a maximum. 
C) The output where marginal product is at a maximum. 
D) The output where marginal cost is at a minimum. 
E) The output where average cost is at a minimum. 
A) The output where total product is at a maximum. 
B) The output where average product is at a maximum. 
C) The output where marginal product is at a maximum. 
D) The output where marginal cost is at a minimum. 
E) The output where average cost is at a minimum.

Question 16

Below are some production data for Quite Simple Products Ltd.
  
-Refer to the information above to answer this question.What is the value of average product when marginal product is zero?

Accepted Answer

A) 0. 
B) 7. 
C) 30.9. 
D) 27. 
E) Cannot be determined. 
A) 0. 
B) 7. 
C) 30.9. 
D) 27. 
E) Cannot be determined.

Question 17

-Refer to the information above to answer this question.What is the most productive level of output?

Accepted Answer

A) 30. 
B) 40. 
C) 50. 
D) 60. 
E) Cannot be determined. 
A) 30. 
B) 40. 
C) 50. 
D) 60. 
E) Cannot be determined.

Question 18

-Refer to the graph above to answer this question.Which curve illustrates average total cost?

Accepted Answer

A) 1. 
B) 2. 
C) 3. 
D) 4. 
A) 1. 
B) 2. 
C) 3. 
D) 4.

Question 19

Below are some financial data for the Do Drop In convenience store.
   The owners have put $40,000 into the business and they worked a total of 80 hours during the week.Savings accounts are currently paying 5.2% interest and the going wage rate is $8 per hour.
-What is the term for the historical costs of buying plant,machinery and equipment that have no current resale value?

Accepted Answer

A) Sunk cost. 
B) Depreciation. 
C) Short run cost. 
D) Long run cost. 
E) Implicit cost. 
A) Sunk cost. 
B) Depreciation. 
C) Short run cost. 
D) Long run cost. 
E) Implicit cost.

Question 20

The graph below illustrates the average and marginal product of labour for Get Smart Enterprises.
  
-Refer to the graph above to answer this question.How many units of labour does the firm need to employ to achieve maximum output?

Accepted Answer

A) 1. 
B) 3. 
C) 6. 
D) 9. 
E) 12. 
A) 1. 
B) 3. 
C) 6. 
D) 9. 
E) 12.

-Refer to the graph above to answer this question.Which curve illustrates average fixed cost?

"A change in the AVC curve will lead to a change in the ATC curve;therefore,if there is a change in the ATC curve,there must have been a change in the AVC curve." Evaluate this statement.

The data in the table is for a firm in which labour is the only variable cost and each unit of labour costs the same regardless of how many units are bought. -Refer to the information above to answer this question.What is the value of AVC if 3 units of labour are used?

Below are some production data for Quite Simple Products Ltd. -Refer to the information above to answer this question.How many units of labour are being used when the firm is at its most productive point?

"Fill in the blank" in the table below and then answering the question below. -Refer to the information above to answer this question.What is marginal cost when output is 4?

What is the sum of total variable costs and total fixed costs?

-Refer to the information above to answer this question.What is the value of average total cost at the point of diminishing returns?

How does the calculation of profit differ between an economist and an accountant?

The data in the table is for a firm in which labour is the only variable cost and each unit of labour costs the same regardless of how many units are bought. -Refer to the information above to answer this question.What are the missing numbers for AP in the fourth column?

What is the relationship between the AP/MP curves and the AVC/MC curves?

-What is the term for the increase in total variable costs which results from the production of one more unit of output?

Which of the following are fixed costs (F),and which are variable costs(V)? a)electricity costs b)an annual insurance policy c)overtime pay for production workers d)property taxes on buildings and land owned by the business

If marginal product is declining,which of the following statements is correct?

What is average variable cost?

What do economists mean by the term "the most productive output"?

Below are some production data for Quite Simple Products Ltd. -Refer to the information above to answer this question.What is the value of average product when marginal product is zero?

-Refer to the information above to answer this question.What is the most productive level of output?

-Refer to the graph above to answer this question.Which curve illustrates average total cost?

The graph below illustrates the average and marginal product of labour for Get Smart Enterprises. -Refer to the graph above to answer this question.How many units of labour does the firm need to employ to achieve maximum output?

The Economic Problem

Demand and Supply: An Introduction

Demand and Supply: An Elaboration

Elasticity

Consumer Choice

Costs in the Long Run

Perfect Competition

An Evaluation of Competitive Markets

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters

Exam 6: A Firms Production Decisions and Costs in the Short Run

-Refer to the graph above to answer this question.Which curve illustrates average fixed cost?

"A change in the AVC curve will lead to a change in the ATC curve;therefore,if there is a change in the ATC curve,there must have been a change in the AVC curve." Evaluate this statement.

The data in the table is for a firm in which labour is the only variable cost and each unit of labour costs the same regardless of how many units are bought. -Refer to the information above to answer this question.What is the value of AVC if 3 units of labour are used?

Below are some production data for Quite Simple Products Ltd. -Refer to the information above to answer this question.How many units of labour are being used when the firm is at its most productive point?

"Fill in the blank" in the table below and then answering the question below. -Refer to the information above to answer this question.What is marginal cost when output is 4?

What is the sum of total variable costs and total fixed costs?

-Refer to the information above to answer this question.What is the value of average total cost at the point of diminishing returns?

How does the calculation of profit differ between an economist and an accountant?

The data in the table is for a firm in which labour is the only variable cost and each unit of labour costs the same regardless of how many units are bought. -Refer to the information above to answer this question.What are the missing numbers for AP in the fourth column?

What is the relationship between the AP/MP curves and the AVC/MC curves?

-What is the term for the increase in total variable costs which results from the production of one more unit of output?

Which of the following are fixed costs (F),and which are variable costs(V)? a)electricity costs b)an annual insurance policy c)overtime pay for production workers d)property taxes on buildings and land owned by the business

If marginal product is declining,which of the following statements is correct?

What is average variable cost?

What do economists mean by the term "the most productive output"?

Below are some production data for Quite Simple Products Ltd. -Refer to the information above to answer this question.What is the value of average product when marginal product is zero?

-Refer to the information above to answer this question.What is the most productive level of output?

-Refer to the graph above to answer this question.Which curve illustrates average total cost?

The graph below illustrates the average and marginal product of labour for Get Smart Enterprises. -Refer to the graph above to answer this question.How many units of labour does the firm need to employ to achieve maximum output?

The Economic Problem

Demand and Supply: An Introduction

Demand and Supply: An Elaboration

Elasticity

Consumer Choice

Costs in the Long Run

Perfect Competition

An Evaluation of Competitive Markets

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters