Question 1

Table 13-3 
-Refer to Table 13-3. The marginal product of the second worker is

Accepted Answer

A)  90 units.
B)  85 units.
C)  80 units.
D)  20 units.E) B) and D)
F) All of the above

Question 2

Cindy's Car Wash has average variable costs of $2 and average fixed costs of $3 when it produces 100 units of output (car washes) . The firm's total cost is

Accepted Answer

A)  $100.
B)  $200.
C)  $300.
D)  $500.E) A) and B)
F) All of the above

Question 3

Table 13-14 
-Refer to Table 13-14. What is the average fixed cost of producing 3 units of output?

Accepted Answer

A)  $1.67
B)  $3.33
C)  $10
D)  $20E) C) and D)
F) B) and D)

Question 4

Suppose that Christine owns her own CPA firm. She uses only two inputs in her business: her hours worked (labor)  and a computer (capital) . In the short run, Christine most likely considers

Accepted Answer

A)  both labor and capital to be fixed.
B)  both labor and capital to be variable.
C)  capital to be variable and labor to be fixed.
D)  labor to be variable and capital to be fixed.E) None of the above
F) All of the above

Question 5

Scenario 13-17
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 13-17. Farmer Brown's marginal cost of producing 9 units of output (using 2 bags of seed)  is

Accepted Answer

A)  $240.
B)  $120.
C)  $40.
D)  $30.E) A) and B)
F) None of the above

Question 6

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

Accepted Answer

A)  $16.67
B)  $50
C)  $136.67
D)  $360E) All of the above
F) B) and C)

Question 7

Table 13-5 
-Refer to Table 13-5. Assume that fixed costs are $500, and variable costs are $100 per worker. For this firm, what are the shapes of the production function and the total-cost curve?

Accepted Answer

A)  Both the production function and total-cost curve are increasing at an increasing rate.
B)  Both the production function and total-cost curve are increasing at a decreasing rate.
C)  The production function is increasing at an increasing rate, whereas the total-cost function is increasing at a decreasing rate.
D)  The production function is increasing at a decreasing rate, whereas the total-cost function is increasing at an increasing rate.E) A) and B)
F) A) and C)

Question 8

Profit is defined as total revenue

Accepted Answer

A)  plus total cost.
B)  times total cost.
C)  minus total cost.
D)  divided by total cost.E) A) and B)
F) B) and D)

Question 9

Economists normally assume that the goal of a firm is to (i) 
Earn profits as large as possible, even if it means reducing output.
(ii) 
Earn revenues as large as possible, even if it means reducing profits.
(iii) 
Minimize costs, regardless of profits.

Accepted Answer

A)  (i)  only
B)  (i)  and (ii)  only
C)  (ii)  and (iii)  only
D)  (i) , (ii) , and (iii) E) C) and D)
F) All of the above

Exam 13: The Costs of Production

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Table 13-5 -Refer to Table 13-5. Assume that fixed costs are $500, and variable costs are $100 per worker. For this firm, what are the shapes of the production function and the total-cost curve?

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Table 13-3 -Refer to Table 13-3. The marginal product of the second worker is

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

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Suppose that Christine owns her own CPA firm. She uses only two inputs in her business: her hours worked (labor) and a computer (capital) . In the short run, Christine most likely considers

Correct Answer
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Economists normally assume that the goal of a firm is to (i) Earn profits as large as possible, even if it means reducing output. (ii) Earn revenues as large as possible, even if it means reducing profits. (iii) Minimize costs, regardless of profits.

Correct Answer
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Cindy's Car Wash has average variable costs of $2 and average fixed costs of $3 when it produces 100 units of output (car washes) . The firm's total cost is

Correct Answer
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Profit is defined as total revenue

Correct Answer
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Table 13-14 -Refer to Table 13-14. What is the average fixed cost of producing 3 units of output?

Correct Answer
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Exam 13: The Costs of Production

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Table 13-5 -Refer to Table 13-5. Assume that fixed costs are $500, and variable costs are $100 per worker. For this firm, what are the shapes of the production function and the total-cost curve?

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Table 13-3 -Refer to Table 13-3. The marginal product of the second worker is

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

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Suppose that Christine owns her own CPA firm. She uses only two inputs in her business: her hours worked (labor) and a computer (capital) . In the short run, Christine most likely considers

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Economists normally assume that the goal of a firm is to (i) Earn profits as large as possible, even if it means reducing output. (ii) Earn revenues as large as possible, even if it means reducing profits. (iii) Minimize costs, regardless of profits.

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Cindy's Car Wash has average variable costs of $2 and average fixed costs of $3 when it produces 100 units of output (car washes) . The firm's total cost is

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Profit is defined as total revenue

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Table 13-14 -Refer to Table 13-14. What is the average fixed cost of producing 3 units of output?

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