Exam 11: Technology, production, and Costs

Table 11-2 Table 11-2 summarizes production at the Crunchy Apple Orchard for the month of April 2005. -Refer to Table 11-2.What is the marginal product of the 4th worker?

Which of the following are implicit costs for a typical firm?

If production displays constant returns to scale,then all economies of scale have been exhausted.

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

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.

Figure 11-11 Figure 11-11 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: ATC_a, ATC_b and ATC_c. -Refer to Figure 11-11.Constant returns to scale

In the long run,all of a firm's inputs are variable.

Figure 11-1 -Refer to Figure 11-1.The average product of the 4th worker

Which of the following describes how output changes in the short run? Because of specialization and the division of labor,as more workers are hired

The slope of an isocost line determines the marginal rate of substitution.

Table 11-1 Table 11-1 shows the technology of production at the Matsuko's Mushroom Farm for the month of May. -Refer to Table 11-1.What is the marginal product of the 4th worker?

Vipsana's Gyros House sells gyros.The cost of ingredients (pita,meat,spices,etc.)to make a gyro is $2.00.Vipsana pays her employees $60 per day.She also incurs a fixed cost of $120 per day.Calculate Vipsana's variable cost per day when she produces 50 gyros using two workers?

Which of the following statements regarding a firm's long-run average total cost (LRATC)curve and its short-run average total cost (SRATC)curve is true?

If we have information about workers' marginal products,then total and average product can be found by

Which of the following is a factor of production that generally is fixed in the short run?

In the short run,if marginal product is at its maximum,then

Suppose you have just opened a store to sell espresso machines.Both you and a competing store buy this machine from a manufacturer for $130 each.Your competitor who has a store of the same size as yours is currently selling about 10 machines a month at a price of $200 per machine.You expect to sell about 6 machines a month at a price of $220 per machine.If you lower your price,you expect to make a loss.Which of the following could explain why your competitor is able to profitably sell the machine at a lower price although the cost of purchasing the machine is the same for the both of you?

The River Rouge plant was built by the Ford Motor Company in the 1920s to produce the company's Model A car.Which of the following is evidence that the River Rouge plant suffered from diseconomies of scale?

What is minimum efficient scale? What is likely to happen in the long run to firms that do not reach minimum efficient scale?

The level of output at which all economies of scale have been exhausted is known as