Question 1

What is the marginal product of labor and what is the average product of labor.

Accepted Answer

The marginal product of labor is the add

Question 2

Describe the difference between technology and positive technological change.

Accepted Answer

A firm's technology refers to the proces

Question 3

Improvements in technology used to produce solar panels allow manufacturers such as 1366 Technologies to produce

Accepted Answer

A) more output using the same inputs,thereby reducing average total cost. 
B) the same output using more inputs,thereby reducing average total cost. 
C) more output using more inputs,thereby reducing total fixed cost. 
D) the same output using fewer inputs,thereby reducing total fixed cost. 
A) more output using the same inputs,thereby reducing average total cost. 
B) the same output using more inputs,thereby reducing average total cost. 
C) more output using more inputs,thereby reducing total fixed cost. 
D) the same output using fewer inputs,thereby reducing total fixed cost.

Question 4

The change in a firm's total cost from producing one more unit of a good or service is

Accepted Answer

A) the result of economies of scale. 
B) the definition of marginal product 
C) the definition of marginal cost. 
D) impossible to observe in large firms with many manufacturing plants. 
A) the result of economies of scale. 
B) the definition of marginal product 
C) the definition of marginal cost. 
D) impossible to observe in large firms with many manufacturing plants.

Question 5

Figure 11-1   Fancy Footwear manufactures shoes.Figure 11-1 shows Fancy Footwear's marginal product of labor and average product of labor curves in the short run.
-Refer to Figure 11-1.Which of the following statements correctly describes the curves in the figure?

Accepted Answer

A) The marginal product of labor curve is represented by curve A and the average product of labor curve is represented by curve B. 
B) The marginal product of labor curve is represented by curve B and the average product of labor curve is represented by curve A. 
C) Curve A could represent either the average product curve or the marginal product and curve.Curve B represents the total product curve. 
D) Curve B could represent either the average product curve or the marginal product curve.Curve A represents the total product curve. 
A) The marginal product of labor curve is represented by curve A and the average product of labor curve is represented by curve B. 
B) The marginal product of labor curve is represented by curve B and the average product of labor curve is represented by curve A. 
C) Curve A could represent either the average product curve or the marginal product and curve.Curve B represents the total product curve. 
D) Curve B could represent either the average product curve or the marginal product curve.Curve A represents the total product curve.

Question 6

Joan Jillson owns a coffee shop.Assume that the marginal product of the labor Joan employs (MPL)equals 500 cups per week and the marginal product of her shop's capital (MPK)equals 1,000.Assume also that the wage (w)Joan pays her workers equals $250 per week and the rental price (r)of her capital - her coffee machines - equals $500 per week.Which of the following correctly analyzes whether Joan is minimizing her costs?

Accepted Answer

A) No,Joan is not minimizing her costs because MPK is greater than MPL and r is greater than w. 
B) Yes,Joan is minimizing her costs because MPK/r equals MPL/w. 
C) No,Joan is not minimizing her costs because MPL × w is less than MPK × r. 
D) Yes,Joan is minimizing her costs because the she is a price-taker in the markets for labor and capital. 
A) No,Joan is not minimizing her costs because MPK is greater than MPL and r is greater than w. 
B) Yes,Joan is minimizing her costs because MPK/r equals MPL/w. 
C) No,Joan is not minimizing her costs because MPL × w is less than MPK × r. 
D) Yes,Joan is minimizing her costs because the she is a price-taker in the markets for labor and capital.

Question 7

The slope of an isoquant is equal to the ratio of the price of the input on the horizontal axis divided by the price of the input on the vertical axis,multiplied by -1.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following statements explains the difference between diminishing returns and diseconomies of scale?

Accepted Answer

A) Diminishing returns are the result of changes in explicit costs.Diseconomies of scale are the result of changes in explicit costs and implicit costs. 
B) Diminishing returns refer to production while diseconomies of scale refer to costs. 
C) Diminishing returns cause a firm's marginal cost curve to rise; diseconomies of scale cause a firm's marginal cost curve to fall. 
D) Diminishing returns apply only to the short run; diseconomies of scale apply only in the long run. 
A) Diminishing returns are the result of changes in explicit costs.Diseconomies of scale are the result of changes in explicit costs and implicit costs. 
B) Diminishing returns refer to production while diseconomies of scale refer to costs. 
C) Diminishing returns cause a firm's marginal cost curve to rise; diseconomies of scale cause a firm's marginal cost curve to fall. 
D) Diminishing returns apply only to the short run; diseconomies of scale apply only in the long run.

Question 9

Economists Cade Massey and Richard Thaler analyzed whether teams in the National Football League distributed salaries efficiently.Massey and Thaler found that

Accepted Answer

A) the first few players selected in first round of the NFL draft are paid much higher salaries relative to their marginal products than players drafted later in the first round. 
B) rookies are paid salaries greater than their marginal products; veteran players are paid salaries less than their marginal products. 
C) veteran players who sign as free agents are paid more relative to their marginal products than rookie players selected in the first round of the draft. 
D) both rookie players and veteran players are paid less than the value of their marginal products because of the lack of competition among teams. 
A) the first few players selected in first round of the NFL draft are paid much higher salaries relative to their marginal products than players drafted later in the first round. 
B) rookies are paid salaries greater than their marginal products; veteran players are paid salaries less than their marginal products. 
C) veteran players who sign as free agents are paid more relative to their marginal products than rookie players selected in the first round of the draft. 
D) both rookie players and veteran players are paid less than the value of their marginal products because of the lack of competition among teams.

Question 10

Figure 11-9  
-Refer to Figure 11-9.A curve that connects points a,d and e is called

Accepted Answer

A) an input-output curve. 
B) a total cost line. 
C) an expansion path. 
D) an indifference line. 
A) an input-output curve. 
B) a total cost line. 
C) an expansion path. 
D) an indifference line.

Question 11

Figure 11-5  
-Refer to Figure 11-5 above to solve the following problems.
a.Calculate the fixed cost of production.
b.Calculate the average total cost of production when the firm produces 20 units of output.
c.Calculate the average variable cost of production when the firm produces 20 units of output.
d.Calculate the average fixed cost of production when the firm produces 20 units of output.
e.Calculate the average fixed cost of production when the firm produces 15 units of output.
f.If the firm increases output from 15 to 20 units what is the marginal cost of output?

Accepted Answer

a.$100 b.$

Question 12

Which of the following statements is false?

Accepted Answer

A) An implicit cost is a nonmonetary opportunity cost. 
B) Economic costs include both accounting costs and implicit costs. 
C) An explicit cost is a cost that involves spending money. 
D) Economists consider all costs to be implicit costs. 
A) An implicit cost is a nonmonetary opportunity cost. 
B) Economic costs include both accounting costs and implicit costs. 
C) An explicit cost is a cost that involves spending money. 
D) Economists consider all costs to be implicit costs.

Question 13

In the short-run,changes in output can only be brought about by a change in the quantity of variable inputs.

Accepted Answer

A) True 
 B)False

Question 14

A curve showing the lowest cost at which a firm is able to produce a given level of output in the long run is

Accepted Answer

A) a long-run production function. 
B) a long-run marginal cost curve. 
C) a minimum efficient scale curve. 
D) a long-run average total cost curve. 
A) a long-run production function. 
B) a long-run marginal cost curve. 
C) a minimum efficient scale curve. 
D) a long-run average total cost curve.

Question 15

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

Accepted Answer

A) True 
 B)False

Question 16

The relationship between the inputs employed by a firm and the maximum output that it can produce with those inputs is the firm's

Accepted Answer

A) production function. 
B) supply curve,or supply schedule. 
C) marginal product of labor. 
D) average product of labor. 
A) production function. 
B) supply curve,or supply schedule. 
C) marginal product of labor. 
D) average product of labor.

Question 17

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 18

A firm's short-run average total cost curve is parallel to its short-run average variable cost curve.

Accepted Answer

A) True 
 B)False

Question 19

Figure 11-6   Figure 11-6 illustrates the long-run average cost curve for a firm that produces picture frames.The graph also includes short-run average cost curves for three firm sizes: ATCa,ATCb and ATCc.
-Refer to Figure 11-6.If the firm chooses to produce and sell 25,000 frames per month by operating in the short run with a scale operation represented by ATCc

Accepted Answer

A) the firm will not be operating efficiently. 
B) the firm will be operating efficiently. 
C) the firm would lower its average costs by reducing its scale of operation. 
D) the firm will not be able to earn a profit. 
A) the firm will not be operating efficiently. 
B) the firm will be operating efficiently. 
C) the firm would lower its average costs by reducing its scale of operation. 
D) the firm will not be able to earn a profit.

Question 20

Which of the following statements is true?

Accepted Answer

A) As output increases,average fixed cost becomes smaller and smaller. 
B) Average fixed cost does not change as output increases. 
C) The marginal cost curve intersects the average fixed cost curve at its minimum point. 
D) When marginal cost is greater than average fixed cost,average fixed cost increases. 
A) As output increases,average fixed cost becomes smaller and smaller. 
B) Average fixed cost does not change as output increases. 
C) The marginal cost curve intersects the average fixed cost curve at its minimum point. 
D) When marginal cost is greater than average fixed cost,average fixed cost increases.

What is the marginal product of labor and what is the average product of labor.

Describe the difference between technology and positive technological change.

Improvements in technology used to produce solar panels allow manufacturers such as 1366 Technologies to produce

The change in a firm's total cost from producing one more unit of a good or service is

Figure 11-1 Fancy Footwear manufactures shoes.Figure 11-1 shows Fancy Footwear's marginal product of labor and average product of labor curves in the short run. -Refer to Figure 11-1.Which of the following statements correctly describes the curves in the figure?

The slope of an isoquant is equal to the ratio of the price of the input on the horizontal axis divided by the price of the input on the vertical axis,multiplied by -1.

Which of the following statements explains the difference between diminishing returns and diseconomies of scale?

Economists Cade Massey and Richard Thaler analyzed whether teams in the National Football League distributed salaries efficiently.Massey and Thaler found that

Figure 11-9 -Refer to Figure 11-9.A curve that connects points a,d and e is called

Which of the following statements is false?

In the short-run,changes in output can only be brought about by a change in the quantity of variable inputs.

A curve showing the lowest cost at which a firm is able to produce a given level of output in the long run is

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

The relationship between the inputs employed by a firm and the maximum output that it can produce with those inputs is the firm's

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?

A firm's short-run average total cost curve is parallel to its short-run average variable cost curve.

Which of the following statements is true?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency, government Price Setting, and Taxes

Externalities, environmental Policy, and Public Goods

Elasticity: the Responsiveness of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Firms in Perfectly Competitive Markets

Monopolistic Competition: the Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, taxes, and the Distribution of Income

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Exam 11: Technology, production, and Costs

What is the marginal product of labor and what is the average product of labor.

Describe the difference between technology and positive technological change.

Improvements in technology used to produce solar panels allow manufacturers such as 1366 Technologies to produce

The change in a firm's total cost from producing one more unit of a good or service is

Figure 11-1 Fancy Footwear manufactures shoes.Figure 11-1 shows Fancy Footwear's marginal product of labor and average product of labor curves in the short run. -Refer to Figure 11-1.Which of the following statements correctly describes the curves in the figure?

The slope of an isoquant is equal to the ratio of the price of the input on the horizontal axis divided by the price of the input on the vertical axis,multiplied by -1.

Which of the following statements explains the difference between diminishing returns and diseconomies of scale?

Economists Cade Massey and Richard Thaler analyzed whether teams in the National Football League distributed salaries efficiently.Massey and Thaler found that

Figure 11-9 -Refer to Figure 11-9.A curve that connects points a,d and e is called

Which of the following statements is false?

In the short-run,changes in output can only be brought about by a change in the quantity of variable inputs.

A curve showing the lowest cost at which a firm is able to produce a given level of output in the long run is

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

The relationship between the inputs employed by a firm and the maximum output that it can produce with those inputs is the firm's

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?

A firm's short-run average total cost curve is parallel to its short-run average variable cost curve.

Which of the following statements is true?

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Economic Efficiency, government Price Setting, and Taxes

Externalities, environmental Policy, and Public Goods

Elasticity: the Responsiveness of Demand and Supply

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Comparative Advantage and the Gains From International Trade

Consumer Choice and Behavioral Economics

Firms in Perfectly Competitive Markets

Monopolistic Competition: the Competitive Model in a More Realistic Setting

Oligopoly: Firms in Less Competitive Markets

Monopoly and Antitrust Policy

Pricing Strategy

The Markets for Labor and Other Factors of Production

Public Choice, taxes, and the Distribution of Income

Filters