Exam 13: The Costs of Production

Scenario 13-14 If Farmer Brown plants no seeds on his farm, he gets no harvest. If he plants 1 bag of seeds, he gets 5 bushels of wheat. If he plants 2 bags, he gets 9 bushels. If he plants 3 bags, he gets 12 bushels. A bag of seeds costs $120, and seeds are his only cost. -Refer to Scenario 13-14. Farmer Brown's total­cost curve is

Figure 13-3 -Refer to Figure 13-3. The graph illustrates a typical

Table 13-18 -Refer to Table 13-18. What is the shape of the marginal-cost curve?

Figure 13-3 -Refer to Figure 13-3. The graph illustrates a typical total cost curve. Based on its shape, what does the corresponding production function look like?

In the long run a company that produces and sells covers for cell phones incurs total costs of $2,500 when output is 1,250 covers and $4,000 when output is 1,500 covers. For this range of output, the cell phone cover company exhibits

Table 13-2 -Refer to Table 13-2. At which number of workers does diminishing marginal product begin?

The long-run average total cost curve is always

Table 13-5 -Refer to Table 13-5. The marginal product of the fourth worker is

Table 13-18 -Refer to Table 13-18. What is the average total cost of producing 525 units of output?

Table 13-4 Charles's Math Tutoring -Refer to Table 13-4. What is the marginal product of the second worker?

A production function is a relationship between inputs and

Which field of economics studies how the number of firms affects the prices in a market and the efficiency of market outcomes?

Adam Smith used a famous example of what type of firm to illustrate economies of scale?

Scenario 13-11 Walter builds birdhouses. He spends $5 on the materials for each birdhouse. He can build one in 30 minutes. He is semi-retired but earns $8 per hour at the local hardware store. He can sell a birdhouse for $20 each. -Refer to Scenario 13-11. An economist would calculate the total profit for one birdhouse to be

Scenario 13-6 Ziva is an organic lettuce farmer, but she also spends part of her day as a professional organizing consultant. As a consultant, Ziva helps people organize their houses. Due to the popularity of her home-organization services, Farmer Ziva has more clients requesting her services than she has time to help if she maintains her farming business. Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce. -Refer to Scenario 13-6. Ziva's economic profit from farming equals

An example of an explicit cost of production would be the

If Kevin's children run a lemonade stand for a day and sell 200 glasses of lemonade at $0.50 each, their total revenues are

Constant returns to scale occur when a firm's

Table 13-1 -Refer to Table 13-1. What is total output when 4 workers are hired?

Diseconomies of scale occur when