Question 1

Use the following to answer questions: 
-(Table: Tonya's Production Function for Apples) Look at the table Tonya's Production Function for Apples. The marginal product of the fourth worker is _____ apples.

Accepted Answer

A)  7 
B)  26 
C)  5 
D)  21

Question 2

If two firms are identical in all respects except that one has more of the fixed input capital than another, the total product curve for the firm with more capital:

Accepted Answer

A)  must equal the total product curve for the firm with less capital. 
B)  will lie above the total product curve for the firm with less capital. 
C)  will lie below the total product curve for the firm with less capital. 
D)  will show no diminishing marginal returns.

Question 3

Use the following to answer question:
Table: Linda's Copy Shop Production 
-(Table: Linda's Copy Shop Production) Look at the table Linda's Copy Shop Production. Linda's production runs into diminishing returns to her variable inputs when she employs the _____ unit.

Accepted Answer

A)  second 
B)  third 
C)  fourth 
D)  fifth

Question 4

A planning period during which all of a firm's resources are variable is the _____ run.

Accepted Answer

A)  long 
B)  fixed 
C)  short 
D)  nominal

Question 5

Use the following to answer questions: 
-(Table: Costs of Birthday Cakes) Look at the table Costs of Birthday Cakes. Assume that fixed costs are $10. What is the marginal cost of the fifth cake?

Accepted Answer

A)  $2 
B)  $10 
C)  $12 
D)  $20

Question 6

When a firm has diminishing marginal returns:

Accepted Answer

A)  its output is falling. 
B)  marginal product is falling but is likely to be still positive. 
C)  total product falls because marginal product is falling and positive. 
D)  marginal product is always negative.

Question 7

Use the following to answer questions:
Figure: A Firm's Cost Curves 
-(Figure: A Firm's Cost Curves) Look at the figure A Firm's Cost Curves. The curve X represents the firm's _____ cost curve.

Accepted Answer

A)  marginal 
B)  average total 
C)  average fixed 
D)  average variable

Question 8

Use the following to answer questions: 
-(Figure and Table: Variable, Fixed, and Total Costs) Look at the figure and table Variable, Fixed, and Total Costs. When 96 bushels of wheat is produced, the average fixed cost is _____, average variable cost is _____, and average total cost is _____.

Accepted Answer

A)  $7.84; $11.76; $19.60 
B)  $133.33; $200.00; $333.33 
C)  $4.17; $16.67; $20.83 
D)  $5.33; $13.33; $18.67

Question 9

A firm employs capital as a fixed input and labor as a variable input in the short run. If the cost of capital falls, what will happen to the AVC, ATC, and MC curves? Explain.

Accepted Answer

The answer of A firm employs capital as a fixed...

Question 10

The level of inputs a firm employs will determine a firm's:

Accepted Answer

A)  ability to produce output. 
B)  elasticity of demand. 
C)  stock price. 
D)  location of production.

Question 11

Total cost divided by the quantity of output produced is:

Accepted Answer

A)  always increasing. 
B)  always decreasing. 
C)  average total cost. 
D)  marginal cost.

Question 12

Janet's poodle grooming salon has a total cost curve expressed by the equation TC = 100 + 3Q2, where Q is the quantity of dogs groomed. Given this expression, Janet is operating in the:

Accepted Answer

A)  long run. 
B)  short run, and her fixed costs are $100. 
C)  long run, and her fixed costs are $100. 
D)  short run, and there are no fixed costs.

Question 13

Krista's dry-cleaning business incurs $900 per month in fixed costs. Last month her total output was 3,000 pounds of clothes. This month her total output fell to 2,700 pounds. This means her average fixed cost _____ by a little more than _____.

Accepted Answer

A)  fell; 3.33 cents 
B)  increased; 3.33 cents 
C)  fell; 2.50 cents 
D)  increased; 2.50 cents

Question 14

When returns are diminishing, the marginal cost curve is upward-sloping.

Accepted Answer

A) True 
 B)False

Question 15

The slope of a long-run average total cost curve exhibiting diseconomies of scale is:

Accepted Answer

A)  zero. 
B)  infinite. 
C)  positive. 
D)  negative.

Question 16

The curve that shows the additional cost of each additional unit of output is called the _____ curve.

Accepted Answer

A)  average cost 
B)  total cost 
C)  marginal product 
D)  marginal cost

Question 17

Use the following to answer questions: 
-(Table: Total Cost Data) Look at the table Total Cost Data. What is the total fixed cost for this bicycle firm?

Accepted Answer

A)  $40 
B)  $50 
C)  $100 
D)  $70

Question 18

Use the following to answer questions: 
-(Table: Production Function for Soybeans) Look at the table Production Function for Soybeans. Assume that the fixed input, capital, is 10 acres of land and a tractor, which have a combined cost of $150 per day. The cost of labor is $100 per worker per day. The total cost of producing 75 bushels of soybeans is:

Accepted Answer

A)  $650. 
B)  $1,150. 
C)  $1,225. 
D)  $7,650.

Question 19

For Heidi, the marginal cost of producing one additional photograph equals the change in _____ divided by the change in the _____ of photographs.

Accepted Answer

A)  total cost; number 
B)  marginal cost; number 
C)  total cost; marginal product 
D)  average cost; number

Question 20

Cindy operates Birds-R-Us, a small store manufacturing and selling 100 bird feeders per month. Cindy's monthly total fixed costs are $500, and her monthly total variable costs are $2,500. If for some reason Cindy's fixed cost fell to $400, then her _____ costs would _____.

Accepted Answer

A)  average fixed; increase 
B)  average total; decrease 
C)  marginal; decrease 
D)  average variable; decrease

Exam 11: Behind the Supply Curve: Inputs and Costs

Use the following to answer questions: -(Table: Tonya's Production Function for Apples) Look at the table Tonya's Production Function for Apples. The marginal product of the fourth worker is _____ apples.

If two firms are identical in all respects except that one has more of the fixed input capital than another, the total product curve for the firm with more capital:

Use the following to answer question: Table: Linda's Copy Shop Production -(Table: Linda's Copy Shop Production) Look at the table Linda's Copy Shop Production. Linda's production runs into diminishing returns to her variable inputs when she employs the _____ unit.

A planning period during which all of a firm's resources are variable is the _____ run.

Use the following to answer questions: -(Table: Costs of Birthday Cakes) Look at the table Costs of Birthday Cakes. Assume that fixed costs are $10. What is the marginal cost of the fifth cake?

When a firm has diminishing marginal returns:

Use the following to answer questions: Figure: A Firm's Cost Curves -(Figure: A Firm's Cost Curves) Look at the figure A Firm's Cost Curves. The curve X represents the firm's _____ cost curve.

Use the following to answer questions: -(Figure and Table: Variable, Fixed, and Total Costs) Look at the figure and table Variable, Fixed, and Total Costs. When 96 bushels of wheat is produced, the average fixed cost is ___, average variable cost is _, and average total cost is ___.

A firm employs capital as a fixed input and labor as a variable input in the short run. If the cost of capital falls, what will happen to the AVC, ATC, and MC curves? Explain.

The level of inputs a firm employs will determine a firm's:

Total cost divided by the quantity of output produced is:

Janet's poodle grooming salon has a total cost curve expressed by the equation TC = 100 + 3Q²,where Q is the quantity of dogs groomed. Given this expression, Janet is operating in the:

Krista's dry-cleaning business incurs $900 per month in fixed costs. Last month her total output was 3,000 pounds of clothes. This month her total output fell to 2,700 pounds. This means her average fixed cost _ by a little more than _.

When returns are diminishing, the marginal cost curve is upward-sloping.

The slope of a long-run average total cost curve exhibiting diseconomies of scale is:

The curve that shows the additional cost of each additional unit of output is called the _____ curve.

Use the following to answer questions: -(Table: Total Cost Data) Look at the table Total Cost Data. What is the total fixed cost for this bicycle firm?

For Heidi, the marginal cost of producing one additional photograph equals the change in _ divided by the change in the _ of photographs.

Cindy operates Birds-R-Us, a small store manufacturing and selling 100 bird feeders per month. Cindy's monthly total fixed costs are $500, and her monthly total variable costs are $2,500. If for some reason Cindy's fixed cost fell to $400, then her _ costs would _.

Exam 11: Behind the Supply Curve: Inputs and Costs

Use the following to answer questions: -(Table: Tonya's Production Function for Apples) Look at the table Tonya's Production Function for Apples. The marginal product of the fourth worker is _____ apples.

If two firms are identical in all respects except that one has more of the fixed input capital than another, the total product curve for the firm with more capital:

Use the following to answer question: Table: Linda's Copy Shop Production -(Table: Linda's Copy Shop Production) Look at the table Linda's Copy Shop Production. Linda's production runs into diminishing returns to her variable inputs when she employs the _____ unit.

A planning period during which all of a firm's resources are variable is the _____ run.

Use the following to answer questions: -(Table: Costs of Birthday Cakes) Look at the table Costs of Birthday Cakes. Assume that fixed costs are $10. What is the marginal cost of the fifth cake?

When a firm has diminishing marginal returns:

Use the following to answer questions: Figure: A Firm's Cost Curves -(Figure: A Firm's Cost Curves) Look at the figure A Firm's Cost Curves. The curve X represents the firm's _____ cost curve.

Use the following to answer questions: -(Figure and Table: Variable, Fixed, and Total Costs) Look at the figure and table Variable, Fixed, and Total Costs. When 96 bushels of wheat is produced, the average fixed cost is _____, average variable cost is _____, and average total cost is _____.

A firm employs capital as a fixed input and labor as a variable input in the short run. If the cost of capital falls, what will happen to the AVC, ATC, and MC curves? Explain.

The level of inputs a firm employs will determine a firm's:

Total cost divided by the quantity of output produced is:

Janet's poodle grooming salon has a total cost curve expressed by the equation TC = 100 + 3Q2, where Q is the quantity of dogs groomed. Given this expression, Janet is operating in the:

Krista's dry-cleaning business incurs $900 per month in fixed costs. Last month her total output was 3,000 pounds of clothes. This month her total output fell to 2,700 pounds. This means her average fixed cost _____ by a little more than _____.

When returns are diminishing, the marginal cost curve is upward-sloping.

The slope of a long-run average total cost curve exhibiting diseconomies of scale is:

The curve that shows the additional cost of each additional unit of output is called the _____ curve.

Use the following to answer questions: -(Table: Total Cost Data) Look at the table Total Cost Data. What is the total fixed cost for this bicycle firm?

For Heidi, the marginal cost of producing one additional photograph equals the change in _____ divided by the change in the _____ of photographs.

Cindy operates Birds-R-Us, a small store manufacturing and selling 100 bird feeders per month. Cindy's monthly total fixed costs are $500, and her monthly total variable costs are $2,500. If for some reason Cindy's fixed cost fell to $400, then her _____ costs would _____.

Use the following to answer questions: -(Figure and Table: Variable, Fixed, and Total Costs) Look at the figure and table Variable, Fixed, and Total Costs. When 96 bushels of wheat is produced, the average fixed cost is ___, average variable cost is _, and average total cost is ___.

Janet's poodle grooming salon has a total cost curve expressed by the equation TC = 100 + 3Q²,where Q is the quantity of dogs groomed. Given this expression, Janet is operating in the:

Krista's dry-cleaning business incurs $900 per month in fixed costs. Last month her total output was 3,000 pounds of clothes. This month her total output fell to 2,700 pounds. This means her average fixed cost _ by a little more than _.

For Heidi, the marginal cost of producing one additional photograph equals the change in _ divided by the change in the _ of photographs.

Cindy operates Birds-R-Us, a small store manufacturing and selling 100 bird feeders per month. Cindy's monthly total fixed costs are $500, and her monthly total variable costs are $2,500. If for some reason Cindy's fixed cost fell to $400, then her _ costs would _.