Question 1

The return to entrepreneurship is known as

Accepted Answer

A) economic profit. 
B) normal profit. 
C) opportunity revenue. 
D) normal revenue. 
E) explicit profit. 
A) economic profit. 
B) normal profit. 
C) opportunity revenue. 
D) normal revenue. 
E) explicit profit.

Question 2

-Anna owns a dog grooming salon in Brunswick,Georgia.The above table has Anna's total product schedule.Anna pays each worker $300 per week and she pays rent of $600 a week for her salon.These are her only costs.When Anna has a staff of 2 workers,her average total cost equals

Accepted Answer

A) $2,400. 
B) $300. 
C) $10.00. 
D) $12.00. 
E) $1,200. 
A) $2,400. 
B) $300. 
C) $10.00. 
D) $12.00. 
E) $1,200.

Question 3

Which of the following is correct about marginal and average products?

Accepted Answer

A) When the marginal product is increasing,the average product must be increasing. 
B) When the marginal product exceeds the average product,the average product must be increasing. 
C) When the average product is increasing,the marginal product must be decreasing. 
D) When the marginal product is decreasing,the average product must be decreasing. 
E) When the marginal product is increasing,the average product must be decreasing. 
A) When the marginal product is increasing,the average product must be increasing. 
B) When the marginal product exceeds the average product,the average product must be increasing. 
C) When the average product is increasing,the marginal product must be decreasing. 
D) When the marginal product is decreasing,the average product must be decreasing. 
E) When the marginal product is increasing,the average product must be decreasing.

Question 4

-The above table shows the total product schedule for Hair Today,a hair styling salon.The average product when four workers are hired is

Accepted Answer

A) 10 hair stylings. 
B) 15 hair stylings. 
C) 20 hair stylings. 
D) 240 hair stylings. 
E) the same as when five workers are hired. 
A) 10 hair stylings. 
B) 15 hair stylings. 
C) 20 hair stylings. 
D) 240 hair stylings. 
E) the same as when five workers are hired.

Question 5

What is the difference between a normal profit and an economic profit?

Accepted Answer

A normal profit is the return to entrepr

Question 6

Which of the following is FALSE?

Accepted Answer

A) Long-run average variable costs equal long-run average total costs. 
B) Fixed costs increase in the long run. 
C) As a firm produces more output,eventually it experiences diseconomies of scale. 
D) In the long run,both the amount of capital and labor used by the firm can be changed. 
E) In the long run,the firm has no fixed inputs. 
A) Long-run average variable costs equal long-run average total costs. 
B) Fixed costs increase in the long run. 
C) As a firm produces more output,eventually it experiences diseconomies of scale. 
D) In the long run,both the amount of capital and labor used by the firm can be changed. 
E) In the long run,the firm has no fixed inputs.

Question 7

Economies of scale can occur as a result of which of the following?

Accepted Answer

A) increasing marginal returns as the firm increases its size 
B) lower fixed cost as the firm increases its size 
C) management difficulties as the firm increases its size 
D) greater specialization of labor and capital as the firm increases its size 
E) increased total cost when the firm increases its size 
A) increasing marginal returns as the firm increases its size 
B) lower fixed cost as the firm increases its size 
C) management difficulties as the firm increases its size 
D) greater specialization of labor and capital as the firm increases its size 
E) increased total cost when the firm increases its size

Question 8

As output increases,average total cost decreases

Accepted Answer

A) constantly. 
B) as the average product of labor decreases. 
C) initially and then starts to increase. 
D) in the long run and the short run. 
E) as long as average fixed cost decreases. 
A) constantly. 
B) as the average product of labor decreases. 
C) initially and then starts to increase. 
D) in the long run and the short run. 
E) as long as average fixed cost decreases.

Question 9

Jake opens a pig farm in Idaho.To start his farm,he uses his entire $50,000 of savings from his savings account.The bank was paying him $2,500 interest on his saving.Explain why the $2,500 is one of Jake's costs.

Accepted Answer

When Jake provides the $50,000 to financ

Question 10

If marginal cost increases when output increases,then

Accepted Answer

A) marginal product must decrease when output increases. 
B) average fixed cost is constant. 
C) total cost is constant. 
D) average variable cost must increase when output increases. 
E) average total cost must decrease when output increases. 
A) marginal product must decrease when output increases. 
B) average fixed cost is constant. 
C) total cost is constant. 
D) average variable cost must increase when output increases. 
E) average total cost must decrease when output increases.

Question 11

To produce 10 shirts,the total cost is $80;to produce 11 shirts,the total cost is $99.The marginal cost of the 11th shirt is equal to

Accepted Answer

A) $8. 
B) $9. 
C) $80. 
D) $99. 
E) $19. 
A) $8. 
B) $9. 
C) $80. 
D) $99. 
E) $19.

Question 12

"If the marginal product of labor curve slopes downward,then the average product of labor curve necessarily must slope downward." Explain whether the previous statement is correct or incorrect.

Accepted Answer

The statement is incorrect.The relations

Question 13

What does the average product of labor equal?

Accepted Answer

The average product of labor e

Question 14

When an economist uses the term "cost" referring to a firm,the economist refers to the

Accepted Answer

A) price of the good to the consumer. 
B) explicit cost of producing a good or service but not the implicit cost of producing a good or service. 
C) implicit cost of producing a good or service but not the explicit cost of producing a good or service. 
D) opportunity cost of producing a good or service,which includes both implicit and explicit cost. 
E) cost that can be actually verified and measured. 
A) price of the good to the consumer. 
B) explicit cost of producing a good or service but not the implicit cost of producing a good or service. 
C) implicit cost of producing a good or service but not the explicit cost of producing a good or service. 
D) opportunity cost of producing a good or service,which includes both implicit and explicit cost. 
E) cost that can be actually verified and measured.

Question 15

Jessica is a young doctor who has just started her own practice.Her previous position paid her $80,000 a year.For office space,she uses a building which she owns and which she has rented in the past for $40,000 a year.Her total revenue from her new practice is $250,000.She pays $50,000 to other firms for materials and supplies,and she pays $40,000 in wages to her office nurse.Assume that Jessica's building and equipment do not depreciate and that her normal profit is $20,000.
a.Which of Jessica's costs are explicit costs and what is their total?
b.Which of Jessica's costs are implicit costs and what is their total?
c.What is the opportunity cost of all factors of production employed by Jessica?
d.What is Jessica's economic profit?

Accepted Answer

a.Jessica's explicit costs are the wages

Question 16

-The table above shows the total product schedule for Rick's Lawn Service,a yard care company.When the 4th worker is hired,the ________ product of labor equals ________ lawns mowed.

Accepted Answer

A) average;60 
B) average;3.75 
C) marginal;3.75 
D) marginal;0 
E) marginal;15 
A) average;60 
B) average;3.75 
C) marginal;3.75 
D) marginal;0 
E) marginal;15

Question 17

The long-run average cost curve

Accepted Answer

A) is an upside down U-shape. 
B) is constructed using the short-run marginal cost curves. 
C) shows economies and diseconomies of scale. 
D) Both answers A and B are correct. 
E) Both answers A and C are correct. 
A) is an upside down U-shape. 
B) is constructed using the short-run marginal cost curves. 
C) shows economies and diseconomies of scale. 
D) Both answers A and B are correct. 
E) Both answers A and C are correct.

Question 18

The average total cost curve is U-shaped.At the quantity of output where average total cost is at its minimum,is the marginal cost curve above the average total cost curve,below the average total cost curve,or intersecting the average total cost curve?

Accepted Answer

When the average total cost is at its mi

Question 19

The long-run average cost curve

Accepted Answer

A) is the sum of a firm's short-run average cost curves. 
B) shows the lowest average cost facing a firm as it increases output changing both its plant and labor force. 
C) initially rises when output increases and then falls when output increases. 
D) always falls as output increases. 
E) always rises as output increases. 
A) is the sum of a firm's short-run average cost curves. 
B) shows the lowest average cost facing a firm as it increases output changing both its plant and labor force. 
C) initially rises when output increases and then falls when output increases. 
D) always falls as output increases. 
E) always rises as output increases.

Question 20

A normal profit is defined as

Accepted Answer

A) total revenue minus explicit costs. 
B) the same thing as accounting profit. 
C) the return to entrepreneurship. 
D) total revenue minus implicit costs. 
E) the economic profit minus the implicit costs. 
A) total revenue minus explicit costs. 
B) the same thing as accounting profit. 
C) the return to entrepreneurship. 
D) total revenue minus implicit costs. 
E) the economic profit minus the implicit costs.

The return to entrepreneurship is known as

-Anna owns a dog grooming salon in Brunswick,Georgia.The above table has Anna's total product schedule.Anna pays each worker $300 per week and she pays rent of $600 a week for her salon.These are her only costs.When Anna has a staff of 2 workers,her average total cost equals

Which of the following is correct about marginal and average products?

-The above table shows the total product schedule for Hair Today,a hair styling salon.The average product when four workers are hired is

What is the difference between a normal profit and an economic profit?

Which of the following is FALSE?

Economies of scale can occur as a result of which of the following?

As output increases,average total cost decreases

Jake opens a pig farm in Idaho.To start his farm,he uses his entire $50,000 of savings from his savings account.The bank was paying him $2,500 interest on his saving.Explain why the $2,500 is one of Jake's costs.

If marginal cost increases when output increases,then

To produce 10 shirts,the total cost is $80;to produce 11 shirts,the total cost is $99.The marginal cost of the 11th shirt is equal to

"If the marginal product of labor curve slopes downward,then the average product of labor curve necessarily must slope downward." Explain whether the previous statement is correct or incorrect.

What does the average product of labor equal?

When an economist uses the term "cost" referring to a firm,the economist refers to the

-The table above shows the total product schedule for Rick's Lawn Service,a yard care company.When the 4th worker is hired,the product of labor equals lawns mowed.

The long-run average cost curve

The average total cost curve is U-shaped.At the quantity of output where average total cost is at its minimum,is the marginal cost curve above the average total cost curve,below the average total cost curve,or intersecting the average total cost curve?

The long-run average cost curve

A normal profit is defined as

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 10: Production and Cost

The return to entrepreneurship is known as

-Anna owns a dog grooming salon in Brunswick,Georgia.The above table has Anna's total product schedule.Anna pays each worker $300 per week and she pays rent of $600 a week for her salon.These are her only costs.When Anna has a staff of 2 workers,her average total cost equals

Which of the following is correct about marginal and average products?

-The above table shows the total product schedule for Hair Today,a hair styling salon.The average product when four workers are hired is

What is the difference between a normal profit and an economic profit?

Which of the following is FALSE?

Economies of scale can occur as a result of which of the following?

As output increases,average total cost decreases

Jake opens a pig farm in Idaho.To start his farm,he uses his entire $50,000 of savings from his savings account.The bank was paying him $2,500 interest on his saving.Explain why the $2,500 is one of Jake's costs.

If marginal cost increases when output increases,then

To produce 10 shirts,the total cost is $80;to produce 11 shirts,the total cost is $99.The marginal cost of the 11th shirt is equal to

"If the marginal product of labor curve slopes downward,then the average product of labor curve necessarily must slope downward." Explain whether the previous statement is correct or incorrect.

What does the average product of labor equal?

When an economist uses the term "cost" referring to a firm,the economist refers to the

-The table above shows the total product schedule for Rick's Lawn Service,a yard care company.When the 4th worker is hired,the ________ product of labor equals ________ lawns mowed.

The long-run average cost curve

The average total cost curve is U-shaped.At the quantity of output where average total cost is at its minimum,is the marginal cost curve above the average total cost curve,below the average total cost curve,or intersecting the average total cost curve?

The long-run average cost curve

A normal profit is defined as

Getting Started

The Usand Global Economies

The Economic Problem

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

-The table above shows the total product schedule for Rick's Lawn Service,a yard care company.When the 4th worker is hired,the product of labor equals lawns mowed.