Question 1

-Why is the AVC curve saucer-shaped?

Accepted Answer

A) Because the MC curve is both below and above the AVC curve. 
B) Because the ATC curve is both below and above the AVC curve. 
C) Because the AFC curve is horizontal. 
D) Because the TVC curve is also saucer-shaped. 
A) Because the MC curve is both below and above the AVC curve. 
B) Because the ATC curve is both below and above the AVC curve. 
C) Because the AFC curve is horizontal. 
D) Because the TVC curve is also saucer-shaped.

Question 2

Which of the following pairs are related?

Accepted Answer

A) Maximum average product and minimum marginal cost. 
B) Maximum average product and minimum average variable cost. 
C) Maximum marginal product and minimum average variable cost. 
D) Maximum marginal product and minimum average total cost. 
A) Maximum average product and minimum marginal cost. 
B) Maximum average product and minimum average variable cost. 
C) Maximum marginal product and minimum average variable cost. 
D) Maximum marginal product and minimum average total cost.

Question 3

What do economists consider the true cost of doing business?

Accepted Answer

A) Explicit costs. 
B) Explicit costs less implicit costs. 
C) Implicit costs. 
D) Explicit costs plus implicit costs. 
E) Explicit costs plus economic profits. 
A) Explicit costs. 
B) Explicit costs less implicit costs. 
C) Implicit costs. 
D) Explicit costs plus implicit costs. 
E) Explicit costs plus economic profits.

Question 4

What is the significance of the maximum point on the total product curve?

Accepted Answer

A) It is the point where the increase in output begins to slow down. 
B) It is the point where diminishing returns sets in. 
C) It is the point of maximum marginal product. 
D) It is the point where marginal product is zero. 
A) It is the point where the increase in output begins to slow down. 
B) It is the point where diminishing returns sets in. 
C) It is the point of maximum marginal product. 
D) It is the point where marginal product is zero.

Question 5

-What could have caused the marginal cost curve to decrease from MC1 to MC2?

Accepted Answer

A) Total costs have increased 
B) Average total costs have increased. 
C) Marginal product has increased. 
D) Average variable costs have increased 
E) Fixed costs have decreased. 
A) Total costs have increased 
B) Average total costs have increased. 
C) Marginal product has increased. 
D) Average variable costs have increased 
E) Fixed costs have decreased.

Question 6

What is the term for the increase in total product resulting from the addition of one more unit of input?

Accepted Answer

A) Total product. 
B) Marginal product. 
C) Normal product. 
D) Average product. 
E) Variable product. 
A) Total product. 
B) Marginal product. 
C) Normal product. 
D) Average product. 
E) Variable product.

Question 7

What is the significance of the minimum point on the average total cost curve?

Accepted Answer

The marginal cost curve inters

Question 8

Which of the following statements about the marginal product of labour is correct?

Accepted Answer

A) It may either rise or fall as more labour is used. 
B) It always rises as more labour is used. 
C) It always falls as more labour is used. 
D) There is no relationship between marginal product and labour. 
A) It may either rise or fall as more labour is used. 
B) It always rises as more labour is used. 
C) It always falls as more labour is used. 
D) There is no relationship between marginal product and labour.

Question 9

What might cause the MC curve to shift down?

Accepted Answer

· The marginal cost curve shifts down as

Question 10

Which of the following statements is true concerning sunk costs?

Accepted Answer

A) They are the total costs of any asset that has been purchased in the past. 
B) They are the total costs of any asset,less depreciation,that has been purchased in the past. 
C) It is another term for depreciation. 
D) They have zero opportunity costs. 
A) They are the total costs of any asset that has been purchased in the past. 
B) They are the total costs of any asset,less depreciation,that has been purchased in the past. 
C) It is another term for depreciation. 
D) They have zero opportunity costs.

Question 11

-Refer to the information above to answer this question.What is the value of average variable cost at the most productive output?

Accepted Answer

A) $6. 
B) $5. 
C) $8. 
D) $8.17. 
E) Cannot be determined. 
A) $6. 
B) $5. 
C) $8. 
D) $8.17. 
E) Cannot be determined.

Question 12

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 MC if 5 units of labour are used?

Accepted Answer

A) $1.50. 
B) $2. 
C) $4. 
D) $5. 
E) $20. 
A) $1.50. 
B) $2. 
C) $4. 
D) $5. 
E) $20.

Question 13

"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 average total cost when output is 2?

Accepted Answer

A) $8. 
B) $11. 
C) $12. 
D) $14. 
E) $28. 
A) $8. 
B) $11. 
C) $12. 
D) $14. 
E) $28.

Question 14

State whether each of the cost curves is U-shaped.
a)ATC curve
b)AVC curve
c)AFC curve
d)MC curve
e)TFC curve

Accepted Answer

The ATC curve,AVC cu

Question 15

Which of the following statements is true about the advantages gained through the division of labour?

Accepted Answer

A) It causes the marginal product of labour to increase,but it has no effect on the average product of labour. 
B) It was first thought of by David Ricardo in his example of a hat factory. 
C) It is an idea that has little application in the real world. 
D) Its application results in both the marginal and average product of labour increasing. 
A) It causes the marginal product of labour to increase,but it has no effect on the average product of labour. 
B) It was first thought of by David Ricardo in his example of a hat factory. 
C) It is an idea that has little application in the real world. 
D) Its application results in both the marginal and average product of labour increasing.

Question 16

The total cost of producing 5 premium leather shoes is $900.If the average variable cost is $60,what is total fixed cost?

Accepted Answer

$600
TVC = 60 * 5 =

Question 17

State whether each of the following is an explicit cost or implicit cost for a student attending university.
a)Tuition fee
b)Stress and anxiety from studying
c)Parking fee
d)Lost income

Accepted Answer

a)Explicit cost.
b)I

Question 18

-Refer to the graph above to answer this question.What is the level of economic capacity?

Accepted Answer

A) 80. 
B) 120. 
C) 160. 
D) 180. 
E) 200. 
A) 80. 
B) 120. 
C) 160. 
D) 180. 
E) 200.

Question 19

What are implicit costs?

Accepted Answer

A) Costs that are actually paid out in money. 
B) The annual cost of wear and tear on assets. 
C) The costs of buying machinery and equipment. 
D) Costs that are not actually paid out in money. 
E) Costs that reflect diminishing returns. 
A) Costs that are actually paid out in money. 
B) The annual cost of wear and tear on assets. 
C) The costs of buying machinery and equipment. 
D) Costs that are not actually paid out in money. 
E) Costs that reflect diminishing returns.

-Why is the AVC curve saucer-shaped?

Which of the following pairs are related?

What do economists consider the true cost of doing business?

What is the significance of the maximum point on the total product curve?

-What could have caused the marginal cost curve to decrease from MC₁ to MC₂?

What is the term for the increase in total product resulting from the addition of one more unit of input?

What is the significance of the minimum point on the average total cost curve?

Which of the following statements about the marginal product of labour is correct?

What might cause the MC curve to shift down?

Which of the following statements is true concerning sunk costs?

-Refer to the information above to answer this question.What is the value of average variable cost at the most productive output?

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 MC if 5 units of labour are used?

"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 average total cost when output is 2?

State whether each of the cost curves is U-shaped. a)ATC curve b)AVC curve c)AFC curve d)MC curve e)TFC curve

Which of the following statements is true about the advantages gained through the division of labour?

The total cost of producing 5 premium leather shoes is $900.If the average variable cost is $60,what is total fixed cost?

State whether each of the following is an explicit cost or implicit cost for a student attending university. a)Tuition fee b)Stress and anxiety from studying c)Parking fee d)Lost income

-Refer to the graph above to answer this question.What is the level of economic capacity?

What are implicit costs?

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

-Why is the AVC curve saucer-shaped?

Which of the following pairs are related?

What do economists consider the true cost of doing business?

What is the significance of the maximum point on the total product curve?

-What could have caused the marginal cost curve to decrease from MC1 to MC2?

What is the term for the increase in total product resulting from the addition of one more unit of input?

What is the significance of the minimum point on the average total cost curve?

Which of the following statements about the marginal product of labour is correct?

What might cause the MC curve to shift down?

Which of the following statements is true concerning sunk costs?

-Refer to the information above to answer this question.What is the value of average variable cost at the most productive output?

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 MC if 5 units of labour are used?

"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 average total cost when output is 2?

State whether each of the cost curves is U-shaped. a)ATC curve b)AVC curve c)AFC curve d)MC curve e)TFC curve

Which of the following statements is true about the advantages gained through the division of labour?

The total cost of producing 5 premium leather shoes is $900.If the average variable cost is $60,what is total fixed cost?

State whether each of the following is an explicit cost or implicit cost for a student attending university. a)Tuition fee b)Stress and anxiety from studying c)Parking fee d)Lost income

-Refer to the graph above to answer this question.What is the level of economic capacity?

What are implicit costs?

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

-What could have caused the marginal cost curve to decrease from MC₁ to MC₂?