Question 1

The long run refers to:

Accepted Answer

A)  A time period longer than one year. 
B)  A time period less than one year. 
C)  A period of time long enough for all inputs to be varied. 
D)  The time period required for a firm to cycle its inventory. 
A)  A time period longer than one year. 
B)  A time period less than one year. 
C)  A period of time long enough for all inputs to be varied. 
D)  The time period required for a firm to cycle its inventory.

Question 2

The selection of the short-run rate of output is the:

Accepted Answer

A)  Production decision. 
B)  Investment decision. 
C)  Marginal decision. 
D)  Industrial decision. 
A)  Production decision. 
B)  Investment decision. 
C)  Marginal decision. 
D)  Industrial decision.

Question 3

Which of the following is most likely a variable cost in the short run?

Accepted Answer

A)  Labor 
B)  Property taxes 
C)  Rent 
D)  A business license 
A)  Labor 
B)  Property taxes 
C)  Rent 
D)  A business license

Question 4

Explain how the firm's total cost curve would change if the wage rate paid to the labors increases verses the effect when the firm's property taxes are doubled? What would happen to the firm's profits assuming the revenue does not change? What might the firm do in the long-run verses the short-run?

Accepted Answer

a)In the short-run a wage increase would

Question 5

The short run implies that all factor inputs are fixed.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following are factors of production for Terry's Taco Patio?

Accepted Answer

A)  Economic costs and money 
B)  Average total cost and entrepreneurship 
C)  Productivity and labor 
D)  Corn tortillas and meat 
A)  Economic costs and money 
B)  Average total cost and entrepreneurship 
C)  Productivity and labor 
D)  Corn tortillas and meat

Question 7

A firm can be identified as profitable if the:

Accepted Answer

A)  Sum of total revenue and total costs is high. 
B)  Difference between its total revenue and total costs is negative. 
C)  Difference between its total revenue and total costs is positive. 
D)  Total costs and marginal costs are low. 
A)  Sum of total revenue and total costs is high. 
B)  Difference between its total revenue and total costs is negative. 
C)  Difference between its total revenue and total costs is positive. 
D)  Total costs and marginal costs are low.

Question 8

When producing jeans,which of the following are not a variable cost in the short run?

Accepted Answer

A)  Wages 
B)  Zippers 
C)  Rent for the factory 
D)  Denim material 
A)  Wages 
B)  Zippers 
C)  Rent for the factory 
D)  Denim material

Question 9

The short-run supply decision focuses on:

Accepted Answer

A)  Marginal output versus price. 
B)  Marginal cost versus price. 
C)  Average total cost versus marginal revenue. 
D)  Variable costs versus fixed costs. 
A)  Marginal output versus price. 
B)  Marginal cost versus price. 
C)  Average total cost versus marginal revenue. 
D)  Variable costs versus fixed costs.

Question 10

If an additional unit of labor costs $40 and has an MPP of 50 units of output,the marginal cost is:

Accepted Answer

A)  $2,000.00. 
B)  $40.00. 
C)  $1.25. 
D)  $0.80 
A)  $2,000.00. 
B)  $40.00. 
C)  $1.25. 
D)  $0.80

Question 11

Average total cost is defined as:

Accepted Answer

A)  Total cost divided by the quantity produced. 
B)  The change in total cost because of a one-unit increase in output. 
C)  The change in total output divided by the change in total cost. 
D)  Total output times total cost. 
A)  Total cost divided by the quantity produced. 
B)  The change in total cost because of a one-unit increase in output. 
C)  The change in total output divided by the change in total cost. 
D)  Total output times total cost.

Question 12

Table 5.2-Jeans Production  
-What is the marginal cost of the 30th pair of jeans in Table 5.2?

Accepted Answer

A)  $4.50 
B)  $45.00 
C)  $6.00 
D)  $1.50 
A)  $4.50 
B)  $45.00 
C)  $6.00 
D)  $1.50

Question 13

Table 5.5-Production costs  
-In Table 5.5,the total variable cost of the first unit is:

Accepted Answer

A)  $9. 
B)  $10. 
C)  $19. 
D)  $29. 
A)  $9. 
B)  $10. 
C)  $19. 
D)  $29.

Question 14

Assume a toy company hires an additional worker to assemble toys,and the size of the factory and amount of equipment remain constant.As a result,the level of output increases but by a smaller amount than when the previous additional worker was hired.This is an example of:

Accepted Answer

A)  The law of poor planning. 
B)  The law of diminishing returns. 
C)  Say's Law. 
D)  The law of substitution. 
A)  The law of poor planning. 
B)  The law of diminishing returns. 
C)  Say's Law. 
D)  The law of substitution.

Question 15

Profit is the difference between:

Accepted Answer

A)  Total cost and variable cost. 
B)  Total revenue and total cost. 
C)  Marginal cost and fixed cost. 
D)  Average total cost and economic cost. 
A)  Total cost and variable cost. 
B)  Total revenue and total cost. 
C)  Marginal cost and fixed cost. 
D)  Average total cost and economic cost.

Question 16

Which of the following government policies is least likely to increase productivity?

Accepted Answer

A)  Subsidies for schools 
B)  Student loans 
C)  Tax incentives for firms that invest in capital 
D)  Transfer payments to unemployed workers 
A)  Subsidies for schools 
B)  Student loans 
C)  Tax incentives for firms that invest in capital 
D)  Transfer payments to unemployed workers

Question 17

Table 5.5-Production costs  
-In Table 5.5,the total cost of 2 units is:

Accepted Answer

A)  $3. 
B)  $10. 
C)  $12. 
D)  $22. 
A)  $3. 
B)  $10. 
C)  $12. 
D)  $22.

Question 18

Table 5.4-Plant costs
This table shows total costs at different output levels for a given plant.  
-In Table 5.4,fixed costs:

Accepted Answer

A)  Are equal to $40. 
B)  Are equal to zero. 
C)  Increase as output increases. 
D)  Decrease as output increases. 
A)  Are equal to $40. 
B)  Are equal to zero. 
C)  Increase as output increases. 
D)  Decrease as output increases.

Question 19

Table 5.6
Complete the following table,and use the information in the table to answer the question(s)below.  
-In Table 5.6,the marginal cost of the third unit of output is:

Accepted Answer

A)  $3. 
B)  $5. 
C)  $6. 
D)  $15. 
A)  $3. 
B)  $5. 
C)  $6. 
D)  $15.

Question 20

Table 5.3-Yearbook costs
(This table shows the total cost of producing yearbooks using a school's print shop. )  
-The production rate in Table 5.3 at which the lowest possible average total cost for yearbooks is achieved would be:

Accepted Answer

A)  200 yearbooks per year. 
B)  300 yearbooks per year. 
C)  400 yearbooks per year. 
D)  500 yearbooks per year. 
A)  200 yearbooks per year. 
B)  300 yearbooks per year. 
C)  400 yearbooks per year. 
D)  500 yearbooks per year.

The long run refers to:

The selection of the short-run rate of output is the:

Which of the following is most likely a variable cost in the short run?

Explain how the firm's total cost curve would change if the wage rate paid to the labors increases verses the effect when the firm's property taxes are doubled? What would happen to the firm's profits assuming the revenue does not change? What might the firm do in the long-run verses the short-run?

The short run implies that all factor inputs are fixed.

Which of the following are factors of production for Terry's Taco Patio?

A firm can be identified as profitable if the:

When producing jeans,which of the following are not a variable cost in the short run?

The short-run supply decision focuses on:

If an additional unit of labor costs $40 and has an MPP of 50 units of output,the marginal cost is:

Average total cost is defined as:

Table 5.2-Jeans Production -What is the marginal cost of the 30^th pair of jeans in Table 5.2?

Table 5.5-Production costs -In Table 5.5,the total variable cost of the first unit is:

Assume a toy company hires an additional worker to assemble toys,and the size of the factory and amount of equipment remain constant.As a result,the level of output increases but by a smaller amount than when the previous additional worker was hired.This is an example of:

Profit is the difference between:

Which of the following government policies is least likely to increase productivity?

Table 5.5-Production costs -In Table 5.5,the total cost of 2 units is:

Table 5.4-Plant costs This table shows total costs at different output levels for a given plant. -In Table 5.4,fixed costs:

Table 5.6 Complete the following table,and use the information in the table to answer the question(s)below. -In Table 5.6,the marginal cost of the third unit of output is:

Table 5.3-Yearbook costs (This table shows the total cost of producing yearbooks using a school's print shop. ) -The production rate in Table 5.3 at which the lowest possible average total cost for yearbooks is achieved would be:

The Challenge of Economics

The US Economy

Supply and Demand

Consumer Demand

Competition

Monopoly

The Labor Market

Government Intervention

The Business Cycle

Aggregate Supply and Demand

Fiscal Policy

Money and Banks

Monetary Policy

Economic Growth

Theory and Reality

International Trade

Filters

Exam 5: Supply Decisions

The long run refers to:

The selection of the short-run rate of output is the:

Which of the following is most likely a variable cost in the short run?

Explain how the firm's total cost curve would change if the wage rate paid to the labors increases verses the effect when the firm's property taxes are doubled? What would happen to the firm's profits assuming the revenue does not change? What might the firm do in the long-run verses the short-run?

The short run implies that all factor inputs are fixed.

Which of the following are factors of production for Terry's Taco Patio?

A firm can be identified as profitable if the:

When producing jeans,which of the following are not a variable cost in the short run?

The short-run supply decision focuses on:

If an additional unit of labor costs $40 and has an MPP of 50 units of output,the marginal cost is:

Average total cost is defined as:

Table 5.2-Jeans Production -What is the marginal cost of the 30th pair of jeans in Table 5.2?

Table 5.5-Production costs -In Table 5.5,the total variable cost of the first unit is:

Assume a toy company hires an additional worker to assemble toys,and the size of the factory and amount of equipment remain constant.As a result,the level of output increases but by a smaller amount than when the previous additional worker was hired.This is an example of:

Profit is the difference between:

Which of the following government policies is least likely to increase productivity?

Table 5.5-Production costs -In Table 5.5,the total cost of 2 units is:

Table 5.4-Plant costs This table shows total costs at different output levels for a given plant. -In Table 5.4,fixed costs:

Table 5.6 Complete the following table,and use the information in the table to answer the question(s)below. -In Table 5.6,the marginal cost of the third unit of output is:

Table 5.3-Yearbook costs (This table shows the total cost of producing yearbooks using a school's print shop. ) -The production rate in Table 5.3 at which the lowest possible average total cost for yearbooks is achieved would be:

The Challenge of Economics

The US Economy

Supply and Demand

Consumer Demand

Competition

Monopoly

The Labor Market

Government Intervention

The Business Cycle

Aggregate Supply and Demand

Fiscal Policy

Money and Banks

Monetary Policy

Economic Growth

Theory and Reality

International Trade

Filters

Table 5.2-Jeans Production -What is the marginal cost of the 30^th pair of jeans in Table 5.2?