Question 1

A total-cost curve shows the relationship between the

Accepted Answer

A)   quantity of an input used and the total cost of production.
B)   quantity of output produced and the total cost of production.
C)   total cost of production and profit.
D)   total cost of production and total revenue.E) A) and C)
F) A) and B)

Question 2

A second or third worker may have a higher marginal product than the first worker in certain circumstances.

Accepted Answer

A) True 
 B)False

Question 3

Table 13-7
The Flying Elvis Copter Rides
 
-Refer to Table 13-7.What is the value of L?

Accepted Answer

A)   $60
B)   $135
C)   $240
D)   $270E) All of the above
F) B) and C)

Question 4

The production function depicts a relationship between which two variables? Also,draw a production function that exhibits diminishing marginal product.

Accepted Answer

The production function depict...

Question 5

Which of the following statements is not correct?

Accepted Answer

A)   Fixed costs are constant.
B)   Variable costs change as output changes.
C)   Average fixed costs are constant.
D)   Average total costs are typically U-shaped.E) None of the above
F) B) and D)

Question 6

Which of the following costs of publishing a book is a fixed cost?

Accepted Answer

A)   author royalties of 5% per book
B)   the costs of paper and binding
C)   shipping and postage expenses
D)   composition,typesetting,and jacket design for the bookE) C) and D)
F) All of the above

Question 7

How long does it take a firm to go from the short run to the long run?

Accepted Answer

A)   six months
B)   one year
C)   two years
D)   It depends on the nature of the firm.E) A) and B)
F) A) and C)

Question 8

Table 13-7
The Flying Elvis Copter Rides
 
-Refer to Table 13-7.What is the value of R?

Accepted Answer

A)   $16.67
B)   $50
C)   $136.67
D)   $360E) A) and C)
F) A) and B)

Question 9

The marginal product of any input is the

Accepted Answer

A)   increase in total cost associated with a one-unit increase in production.
B)   change in total output associated with a $1.00 increase in total cost.
C)   increase in total cost resulting from the hiring of an additional worker.
D)   increase in total output obtained from one additional unit of that input.E) B) and D)
F) A) and C)

Question 10

Which of the following statements is not correct?

Accepted Answer

A)   In the long run,there are no fixed costs.
B)   Marginal cost is independent of fixed costs.
C)   Economies of scale is a short-run concept.
D)   Diminishing marginal product explains increasing marginal cost.E) A) and D)
F) B) and C)

Question 11

Which of the following statements about costs is correct?

Accepted Answer

A)   When marginal cost is less than average total cost,average total cost is rising.
B)   The total cost curve is U-shaped.
C)   As the quantity of output increases,marginal cost eventually rises.
D)   All of the above are correct.E) All of the above
F) None of the above

Question 12

At low levels of production,the firm

Accepted Answer

A)   benefits from increased size because it can take advantage of greater specialization.
B)   has the potential for economies of scale.
C)   is unlikely to experiences acute problems with coordination.
D)   All of the above are correct.E) All of the above
F) A) and D)

Question 13

Profit equals total revenue minus total cost.

Accepted Answer

A) True 
 B)False

Question 14

Table 13-15
Consider the following table of long-run total cost for four different firms:
 
-Refer to Table 13-13.Which firm's long-run marginal cost decreases as output increases?

Accepted Answer

A)   Firm 1
B)   Firm 2
C)   Firm 3
D)   Firm 4E) All of the above
F) A) and D)

Question 15

In the long run Firm A incurs total costs of $1,200 when output is 30 units and $1,400 when output is 40 units.Firm A exhibits

Accepted Answer

A)   diseconomies of scale because total cost is rising as output rises.
B)   diseconomies of scale because average total cost is rising as output rises.
C)   economies of scale because total cost is rising as output rises.
D)   economies of scale because average total cost is falling as output rises.E) All of the above
F) None of the above

Question 16

The marginal-cost curve intersects the average-total-cost curve at the output level where average fixed costs are zero.

Accepted Answer

A) True 
 B)False

Question 17

The average-fixed-cost curve is constant.

Accepted Answer

A) True 
 B)False

Question 18

In the long run,when marginal cost is above average total cost,the average total cost curve exhibits

Accepted Answer

A)   economies of scale.
B)   diseconomies of scale.
C)   constant returns to scale.
D)   efficient scale.E) A) and D)
F) B) and C)

Question 19

Describe the relationship between average total cost and marginal cost.

Accepted Answer

If marginal cost (MC)is greater than ave...

Question 20

If marginal cost is greater than average total cost,then

Accepted Answer

A)   profits are increasing.
B)   economies of scale are becoming greater.
C)   average total cost remains constant.
D)   average total cost is increasing.E) A) and B)
F) A) and C)

Exam 13: The Costs of Production

Which of the following costs of publishing a book is a fixed cost?

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In the long run Firm A incurs total costs of $1,200 when output is 30 units and $1,400 when output is 40 units.Firm A exhibits

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Profit equals total revenue minus total cost.

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Describe the relationship between average total cost and marginal cost.

Correct AnswerverifiedIf marginal cost (MC)is greater than ave...View AnswerShow Answer

How long does it take a firm to go from the short run to the long run?

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At low levels of production,the firm

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Table 13-7 The Flying Elvis Copter Rides -Refer to Table 13-7.What is the value of R?

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If marginal cost is greater than average total cost,then

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The production function depicts a relationship between which two variables? Also,draw a production function that exhibits diminishing marginal product.

Correct AnswerverifiedThe production function depict...View AnswerShow Answer

The marginal-cost curve intersects the average-total-cost curve at the output level where average fixed costs are zero.

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In the long run,when marginal cost is above average total cost,the average total cost curve exhibits

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Which of the following statements is not correct?

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A total-cost curve shows the relationship between the

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Which of the following statements about costs is correct?

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The average-fixed-cost curve is constant.

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A second or third worker may have a higher marginal product than the first worker in certain circumstances.

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Table 13-7 The Flying Elvis Copter Rides -Refer to Table 13-7.What is the value of L?

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Which of the following statements is not correct?

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Table 13-15 Consider the following table of long-run total cost for four different firms: -Refer to Table 13-13.Which firm's long-run marginal cost decreases as output increases?

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The marginal product of any input is the

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If marginal cost (MC)is greater than ave...
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The production function depict...
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