Question 1

Table 13-9
 
-Refer to Table 13-9.What is the variable cost of producing 0 posters?

Accepted Answer

A)   $0.00
B)   $1.00
C)   $10.00
D)   $10.00.E) B) and D)
F) A) and C)

Question 2

In the long run,

Accepted Answer

A)   inputs that were fixed in the short run remain fixed.
B)   inputs that were fixed in the short run become variable.
C)   inputs that were variable in the short run become fixed.
D)   variable inputs are rarely used.E) None of the above
F) A) and B)

Question 3

Total cost can be divided into two types of costs:

Accepted Answer

A)   fixed costs and variable costs.
B)   fixed costs and marginal costs.
C)   variable costs and marginal costs.
D)   average costs and marginal costs.E) A) and D)
F) A) and C)

Question 4

Which of the following is not a property of a firm's cost curves?

Accepted Answer

A)   Marginal cost must eventually rise as a result of diminishing marginal product.
B)   Average total cost is U-shaped.
C)   Economies of scale will exist when average total cost falls as output rises.
D)   Average total cost will cross marginal cost at the minimum of marginal cost.E) A) and B)
F) A) and C)

Question 5

Profit is defined as

Accepted Answer

A)   net revenue minus depreciation.
B)   total revenue minus total cost.
C)   average revenue minus average total cost.
D)   marginal revenue minus marginal cost.E) A) and B)
F) B) and C)

Question 6

A firm's total profit equals its marginal revenue minus its marginal cost.

Accepted Answer

A) True 
 B)False

Question 7

Average total cost equals

Accepted Answer

A)   change in total costs divided by quantity produced.
B)   change in total costs divided by change in quantity produced.
C)   (fixed costs + variable costs) divided by quantity produced.
D)   (fixed costs + variable costs) divided by change in quantity produced.E) A) and C)
F) B) and D)

Question 8

If a firm experiences constant returns to scale at all output levels,then its long-run average total cost curve would

Accepted Answer

A)   slope downward.
B)   be horizontal.
C)   slope upward.
D)   slope downward for low output levels and upward for high output levels.E) A) and C)
F) A) and B)

Question 9

In the long run,a factory is usually considered a fixed input.

Accepted Answer

A) True 
 B)False

Question 10

The most likely explanation for economies of scale is

Accepted Answer

A)   coordination problems.
B)   specialization of labor.
C)   increasing marginal cost.
D)   decreasing marginal cost.E) C) and D)
F) None of the above

Question 11

The cost of producing an additional unit of a good is not the same as the average cost of the good.

Accepted Answer

A) True 
 B)False

Question 12

Consider the following information about baseball production at Bobby's Baseball Factory:  Bobby pays all his workers the same wage,and labor is his only variable cost.From this information we can conclude that Bobby's average variable cost decreases

Accepted Answer

A)   as output rises from 0 to 10,but rises after that.
B)   as output rises from 0 to 26,but rises after that.
C)   as output rises from 0 to 33,but increases after that.
D)   continually as output rises.E) None of the above
F) B) and C)

Question 13

Figure 13-10 1 to Q2. B)  Q2 to Q3. C)  Q3 to Q4. D)  Q4 to Q5." class="answers-bank-image d-inline" rel="preload" >
-Refer to Figure 13-10.The firm experiences economies of scale if it changes its level of output from

Accepted Answer

A)   Q1 to Q2.
B)   Q2 to Q3.
C)   Q3 to Q4.
D)   Q4 to Q5.E) A) and B)
F) B) and C)

Question 14

Which of the following statements is correct?

Accepted Answer

A)   Assuming that explicit costs are positive,economic profit is greater than accounting profit.
B)   Assuming that implicit costs are positive,accounting profit is greater than economic profit.
C)   Assuming that explicit costs are positive,accounting profit is equal to economic profit.
D)   Assuming that implicit costs are positive,economic profit is positive.E) B) and C)
F) A) and D)

Question 15

When a firm's only variable input is labor,then the slope of the production function measures the

Accepted Answer

A)   quantity of labor.
B)   quantity of output.
C)   total cost.
D)   marginal product of labor.E) A) and B)
F) A) and C)

Question 16

Trevor's Tire Company produced and sold 500 tires.The average cost of production per tire was $50.Each tire sold for a price of $65.Trevor's Tire Company's total profits are

Accepted Answer

A)   $7,500.
B)   $25,000.
C)   $32,500.
D)   $67,500.E) B) and C)
F) All of the above

Question 17

Table 13-13
 
-Refer to Table 13-13.What is average fixed cost when output is 40 units?

Accepted Answer

A)   $1.00
B)   $3.32
C)   $5.00
D)   $8.00E) A) and D)
F) B) and D)

Question 18

If a firm produces nothing,which of the following costs will be zero?

Accepted Answer

A)   total cost
B)   fixed cost
C)   opportunity cost
D)   variable costE) None of the above
F) A) and C)

Question 19

Table 13-11
Teacher's Helper is a small company that has a subcontract to produce instructional materials for disabled children in public school districts.The owner rents several small rooms in an office building in the suburbs for $600 a month and has leased computer equipment that costs $480 a month.
 
-Refer to Table 13-11.One month,Teacher's Helper produced 18 instructional modules.What was the average fixed cost for that month?

Accepted Answer

A)   $60
B)   $108
C)   $811
D)   It can't be determined from the information given.E) C) and D)
F) A) and C)

Question 20

Eldin is a house painter.He can paint three houses per week.He is considering hiring his friend Murphy.Murphy can paint five houses per week.What is the maximum total output possible if Eldin hires Murphy?

Accepted Answer

A)   2 houses
B)   3 houses
C)   5 houses
D)   8 housesE) A) and B)
F) None of the above

Exam 13: The Costs of Production

Which of the following is not a property of a firm's cost curves?

Correct Answer
verified

The cost of producing an additional unit of a good is not the same as the average cost of the good.

Correct Answer
verified

When a firm's only variable input is labor,then the slope of the production function measures the

Correct Answer
verified

Which of the following statements is correct?

Correct Answer
verified

If a firm produces nothing,which of the following costs will be zero?

Correct Answer
verified

A firm's total profit equals its marginal revenue minus its marginal cost.

Correct Answer
verified

Total cost can be divided into two types of costs:

Correct Answer
verified

If a firm experiences constant returns to scale at all output levels,then its long-run average total cost curve would

Correct Answer
verified

Profit is defined as

Correct Answer
verified

Eldin is a house painter.He can paint three houses per week.He is considering hiring his friend Murphy.Murphy can paint five houses per week.What is the maximum total output possible if Eldin hires Murphy?

Correct Answer
verified

Average total cost equals

Correct Answer
verified

Correct Answer
verified

In the long run,a factory is usually considered a fixed input.

Correct Answer
verified

Table 13-9 -Refer to Table 13-9.What is the variable cost of producing 0 posters?

Correct Answer
verified

Consider the following information about baseball production at Bobby's Baseball Factory: Bobby pays all his workers the same wage,and labor is his only variable cost.From this information we can conclude that Bobby's average variable cost decreases

Correct Answer
verified

In the long run,

Correct Answer
verified

Figure 13-10 -Refer to Figure 13-10.The firm experiences economies of scale if it changes its level of output from

Correct Answer
verified

Trevor's Tire Company produced and sold 500 tires.The average cost of production per tire was $50.Each tire sold for a price of $65.Trevor's Tire Company's total profits are

Correct Answer
verified

Table 13-13 -Refer to Table 13-13.What is average fixed cost when output is 40 units?

Correct Answer
verified

The most likely explanation for economies of scale is

Correct Answer
verified

Exam 13: The Costs of Production

Which of the following is not a property of a firm's cost curves?

Correct AnswerverifiedShow Answer

The cost of producing an additional unit of a good is not the same as the average cost of the good.

Correct AnswerverifiedShow Answer

When a firm's only variable input is labor,then the slope of the production function measures the

Correct AnswerverifiedShow Answer

Which of the following statements is correct?

Correct AnswerverifiedShow Answer

If a firm produces nothing,which of the following costs will be zero?

Correct AnswerverifiedShow Answer

A firm's total profit equals its marginal revenue minus its marginal cost.

Correct AnswerverifiedShow Answer

Total cost can be divided into two types of costs:

Correct AnswerverifiedShow Answer

If a firm experiences constant returns to scale at all output levels,then its long-run average total cost curve would

Correct AnswerverifiedShow Answer

Profit is defined as

Correct AnswerverifiedShow Answer

Eldin is a house painter.He can paint three houses per week.He is considering hiring his friend Murphy.Murphy can paint five houses per week.What is the maximum total output possible if Eldin hires Murphy?

Correct AnswerverifiedShow Answer

Average total cost equals

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In the long run,a factory is usually considered a fixed input.

Correct AnswerverifiedShow Answer

Table 13-9 -Refer to Table 13-9.What is the variable cost of producing 0 posters?

Correct AnswerverifiedShow Answer

Consider the following information about baseball production at Bobby's Baseball Factory: Bobby pays all his workers the same wage,and labor is his only variable cost.From this information we can conclude that Bobby's average variable cost decreases

Correct AnswerverifiedShow Answer

In the long run,

Correct AnswerverifiedShow Answer

Figure 13-10 -Refer to Figure 13-10.The firm experiences economies of scale if it changes its level of output from

Correct AnswerverifiedShow Answer

Trevor's Tire Company produced and sold 500 tires.The average cost of production per tire was $50.Each tire sold for a price of $65.Trevor's Tire Company's total profits are

Correct AnswerverifiedShow Answer

Table 13-13 -Refer to Table 13-13.What is average fixed cost when output is 40 units?

Correct AnswerverifiedShow Answer

The most likely explanation for economies of scale is

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified