Question 1

One reason why,in the short run,the marginal product of labor might increase initially as more workers are hired is that

Accepted Answer

A) the first workers hired get to use the best equipment. 
B) specialization allows a worker to focus on one task,thereby increasing her proficiency at that task. 
C) the best workers are hired first and later hires are not as skillful. 
D) beyond some point,a firm has hired too many workers. 
A) the first workers hired get to use the best equipment. 
B) specialization allows a worker to focus on one task,thereby increasing her proficiency at that task. 
C) the best workers are hired first and later hires are not as skillful. 
D) beyond some point,a firm has hired too many workers.

Question 2

A characteristic of the long run that is not available in the short run is that a firm is free to vary its output.

Accepted Answer

A) True 
 B)False

Question 3

Average variable cost can be calculated using any of the formulas below except

Accepted Answer

A) TVC/Q. 
B) (TC - F
C) /Q. 
C) Δ(TC - F
C) /ΔQ. 
D) (TC/Q)- AFC. 
A) TVC/Q. 
B) (TC - F
C) /Q. 
C) Δ(TC - F
C) /ΔQ. 
D) (TC/Q)- AFC.

Question 4

If,when a firm doubles all its inputs,its average cost of production decreases,then production displays

Accepted Answer

A) diminishing returns. 
B) economies of scale. 
C) diseconomies of scale. 
D) declining fixed costs. 
A) diminishing returns. 
B) economies of scale. 
C) diseconomies of scale. 
D) declining fixed costs.

Question 5

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?

Accepted Answer

A) $100 
B) $124.40 
C) $220 
D) $240 
A) $100 
B) $124.40 
C) $220 
D) $240

Question 6

If a producer is not able to expand its plant capacity immediately,it is

Accepted Answer

A) bankrupt. 
B) operating in the long run. 
C) operating in the short run. 
D) losing money. 
A) bankrupt. 
B) operating in the long run. 
C) operating in the short run. 
D) losing money.

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

Accounting costs exclude implicit costs.

Accepted Answer

A) True 
 B)False

Question 9

Fill in the missing values in the following table.Draw one graph showing how total output increases with the quantity of workers hired,and another graph showing the marginal product of labor and the average product of labor.

Accepted Answer

The answer of Fill in the missing values in the...

Question 10

Figure 8-5  
-Refer to Figure 8-5.Identify the minimum efficient scale of production.

Accepted Answer

A) Qa 
B) Qb 
C) Qc 
D) Qd 
A) Qa 
B) Qb 
C) Qc 
D) Qd

Question 11

If,when a firm doubles all its inputs,its average cost of production increases,then production displays

Accepted Answer

A) diminishing returns. 
B) economies of scale. 
C) diseconomies of scale. 
D) declining fixed costs. 
A) diminishing returns. 
B) economies of scale. 
C) diseconomies of scale. 
D) declining fixed costs.

Question 12

Describe how Wal-Mart has used positive technological change to manage its inventory.

Accepted Answer

Wal-Mart uses a "just-in-time" inventory

Question 13

A firm's cost of production is determined by all of the following except

Accepted Answer

A) the technology used to produce its output. 
B) the productivity of its workers. 
C) the cost of raw material used in production. 
D) the amount of corporate taxes it must pay on its profit. 
A) the technology used to produce its output. 
B) the productivity of its workers. 
C) the cost of raw material used in production. 
D) the amount of corporate taxes it must pay on its profit.

Question 14

In economics,what is the difference between the short run and the long run?

Accepted Answer

In economics,the short run refers to the

Question 15

If the marginal product of labor is decreasing,then marginal cost of production must be rising.

Accepted Answer

A) True 
 B)False

Question 16

A firm increased its production and sales because the firm's manager rearranged the layout of his factory floor.This is an example of

Accepted Answer

A) investment in human capital. 
B) economies of scale. 
C) positive technological change. 
D) inspired management. 
A) investment in human capital. 
B) economies of scale. 
C) positive technological change. 
D) inspired management.

Question 17

Economic costs of production differ from accounting costs in that

Accepted Answer

A) economic costs include expenditures for hired resources while accounting costs do not. 
B) economic costs add the opportunity costs of a firm using its own resources while accounting costs do not. 
C) accounting costs include expenditures for hired resources while economic costs do not. 
D) accounting costs are always larger than economic cost. 
A) economic costs include expenditures for hired resources while accounting costs do not. 
B) economic costs add the opportunity costs of a firm using its own resources while accounting costs do not. 
C) accounting costs include expenditures for hired resources while economic costs do not. 
D) accounting costs are always larger than economic cost.

Question 18

If the total cost of producing 20 units of output is $1,000 and the average variable cost is $35,what is the firm's average fixed cost at that level of output?

Accepted Answer

A) $65 
B) $50 
C) $15 
D) It is impossible to determine without additional information. 
A) $65 
B) $50 
C) $15 
D) It is impossible to determine without additional information.

Question 19

Due to a downturn in business and increased competition,Dave Amundson,owner of Dave's Delicious Donuts,decides to close half of his 36 donut shops.Use a graph to illustrate average total cost curves for Dave's Delicious Donuts before and after closing the 18 stores.Assume that after closing the stores,Dave's Delicious Donuts will be producing at minimum average total cost.

Accepted Answer

@#IMG-DLM& Before closing the stores,Dave's would

Question 20

Marginal cost is the

Accepted Answer

A) change in average cost when an additional unit of output is produced. 
B) the additional output when total cost is increased by one dollar. 
C) additional cost of producing an additional unit of output. 
D) change in the price of inputs if a firm buys more inputs to produce an additional unit of output. 
A) change in average cost when an additional unit of output is produced. 
B) the additional output when total cost is increased by one dollar. 
C) additional cost of producing an additional unit of output. 
D) change in the price of inputs if a firm buys more inputs to produce an additional unit of output.

One reason why,in the short run,the marginal product of labor might increase initially as more workers are hired is that

A characteristic of the long run that is not available in the short run is that a firm is free to vary its output.

Average variable cost can be calculated using any of the formulas below except

If,when a firm doubles all its inputs,its average cost of production decreases,then production displays

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?

If a producer is not able to expand its plant capacity immediately,it is

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

Accounting costs exclude implicit costs.

Fill in the missing values in the following table.Draw one graph showing how total output increases with the quantity of workers hired,and another graph showing the marginal product of labor and the average product of labor.

Figure 8-5 -Refer to Figure 8-5.Identify the minimum efficient scale of production.

If,when a firm doubles all its inputs,its average cost of production increases,then production displays

Describe how Wal-Mart has used positive technological change to manage its inventory.

A firm's cost of production is determined by all of the following except

In economics,what is the difference between the short run and the long run?

If the marginal product of labor is decreasing,then marginal cost of production must be rising.

A firm increased its production and sales because the firm's manager rearranged the layout of his factory floor.This is an example of

Economic costs of production differ from accounting costs in that

If the total cost of producing 20 units of output is $1,000 and the average variable cost is $35,what is the firm's average fixed cost at that level of output?

Marginal cost is the

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage,international Trade,and Exchange Rates

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Exam 8: Technology,production,and Costs

One reason why,in the short run,the marginal product of labor might increase initially as more workers are hired is that

A characteristic of the long run that is not available in the short run is that a firm is free to vary its output.

Average variable cost can be calculated using any of the formulas below except

If,when a firm doubles all its inputs,its average cost of production decreases,then production displays

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?

If a producer is not able to expand its plant capacity immediately,it is

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

Accounting costs exclude implicit costs.

Fill in the missing values in the following table.Draw one graph showing how total output increases with the quantity of workers hired,and another graph showing the marginal product of labor and the average product of labor.

Figure 8-5 -Refer to Figure 8-5.Identify the minimum efficient scale of production.

If,when a firm doubles all its inputs,its average cost of production increases,then production displays

Describe how Wal-Mart has used positive technological change to manage its inventory.

A firm's cost of production is determined by all of the following except

In economics,what is the difference between the short run and the long run?

If the marginal product of labor is decreasing,then marginal cost of production must be rising.

A firm increased its production and sales because the firm's manager rearranged the layout of his factory floor.This is an example of

Economic costs of production differ from accounting costs in that

If the total cost of producing 20 units of output is $1,000 and the average variable cost is $35,what is the firm's average fixed cost at that level of output?

Marginal cost is the

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Firms in Perfectly Competitive Markets

Monopoly and Antitrust Policy

Monopolistic Competition and Oligopoly

GDP: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage,international Trade,and Exchange Rates

Filters