...and Costs 1) The short run is...
...in which A) the firm is not...
...more workers. B) the amount of output...
...most resources. D) the quantities of some...
...make all of the decisions. Answer: D...
...Answer: D 2) The long run is...
...in which A) the firm can hire...
...can hire all the workers it wants...
...more equipment. B) the firm is able...
...total profit. C) the firm may want...
...is achieved. E) the quantities of all...
...too expensive for the firm to purchase....
...be changed in the short run. D)...
...D) in which the marginal product of...
...in which the marginal product of the...
...marginal product of the last unit of...
...last unit of the input employed exceeds...
...input employed exceeds the marginal product of...
...employed exceeds the marginal product of the...
...marginal product of the previous unit. E)...
...Answer: C 4) The total product curve...
...a graph of the A) minimum cost...
...a change in marginal product. Answer: C...
...C 1 Use the figure below to...
...below to answer the following question(s). Figure...
...Which one of the following statements is...
...false? A) All the points above the...
...the points above the curve are unattainable....
...unattainable. B) All the points below the...
...the points below the curve are attainable....
...attainable. C) All the points below the...
...the points below the curve are inefficient....
...inefficient. D) All the points on the...
...the points on the curve involve equal...
...equal cost to the firm. E) All...
...firm. E) All the points on the...
...the points on the curve are attainable....
...Which one of the following statements is...
...is true? A) The points above the...
...The points above the curve are attainable...
...and inefficient. B) The points below the...
...The points below the curve are attainable...
...and inefficient. C) The points below the...
...The points below the curve are inefficient...
...and unattainable. D) The points on the...
...The points on the curve are efficient...
...unattainable. E) All the points on the...
...the points on the curve have equal...
...curve have equal marginal products. Answer: B...
...Answer: B 7) Marginal product is the...
...Marginal product is the change in total...
...one-unit increase in the variable input, holding...
...variable input, holding the quantity of fixed...
...one-unit increase in the quantity of fixed...
...input employed, holding the quantity of the...
...the quantity of the variable input constant....
...increase in both the quantity of variable...
...D) change in the cost of the...
...the cost of the variable input. E)...
...percent change in the amount of variable...
...A 2 Use the table below to...
...below to answer the following question(s). Table...
...total product curve. The marginal product that...
...product curve. The marginal product that would...
...be produced if the firm employed four...
...Answer: E Use the table below to...
...below to answer the following question(s). Table...
...total product curve. The average product that...
...be produced if the firm employed four...
...to 15 sweaters. The marginal product of...
...15 sweaters. The marginal product of the...
...marginal product of the third worker is...
...a firm increases the total units of...
...as a result, the firm's total output...
...to 400 units. The marginal product of...
...400 units. The marginal product of the...
...marginal product of the sixth worker is...
...Answer: D 12) Marginal product A) is...
...negative. B) is the slope of the...
...the slope of the total product curve....
...B 13) If the total product of...
...is 214 and the total product of...
...is 221, then the marginal product of...
...221, then the marginal product of the...
...marginal product of the fourth worker is...
...C 14) Diminishing marginal returns refers to...
...a situation where the ________ of the...
...the ________ of the last worker hired...
...falls short of the ________ of the...
...the ________ of the previous worker. A)...
...previous worker. A) marginal cost; marginal cost...
...A) marginal cost; marginal cost B) average...
...average cost C) marginal product; marginal product...
...C) marginal product; marginal product D) average...
...average product E) marginal product; average product...
...4 15) When the marginal product of...
...15) When the marginal product of labour...
...is greater than the average product of...
...of labour, A) the average product of...
...is increasing. B) the marginal product of...
...increasing. B) the marginal product of labour...
...is increasing. C) the total product curve...
...negatively sloped. D) the firm is experiencing...
...is experiencing diminishing marginal returns. E) the...
...marginal returns. E) the firm is experiencing...
...Answer: A Use the figure below to...
...below to answer the following question(s). Figure...
...average product curve. The point of maximum...
...energy (E) is the only input used...
...(Q), what is the formula for average...
...energy (E) is the only input used...
..., what is the formula for marginal...
...the formula for marginal product of energy?...
...C 19) Suppose the marginal product of...
...19) Suppose the marginal product of energy...
...is less than the average product of...
...implies that A) the marginal product is...
...that A) the marginal product is equal...
...product is equal the average product. B)...
...average product. B) the marginal product is...
...product. B) the marginal product is greater...
...is greater than the average product at...
...each level of the input used. C)...
...input used. C) the marginal product curve...
...used. C) the marginal product curve is...
...upward sloping. D) the average product curve...
...sloping. E) both the marginal and average...
...E) both the marginal and average product...
...E 20) Suppose the marginal product of...
...20) Suppose the marginal product of energy...
...of energy equals the average product of...
...implies that A) marginal product is negative....
...is maximized. C) marginal product is maximized....
...is maximized. D) the marginal product curve...
...maximized. D) the marginal product curve is...
...Which one of the following statements is...
...correct? A) When marginal product is increasing,...
...is below zero, marginal product remains positive....
...positive. C) When marginal product is increasing,...
...increasing. D) When marginal product is zero,...
...average product exceeds marginal product, both curves...
...Answer: C 22) The average product of...
...energy is A) the increase in total...
...product divided by the increase in energy...
...energy used. B) the total product divided...
...product divided by the quantity of energy...
...energy used. C) the slope of the...
...the slope of the total product curve....
...product curve. D) the slope of the...
...the slope of the marginal product curve....
...slope of the marginal product curve. E)...
...product curve. E) the difference between the...
...the difference between the total product and...
...total product and marginal product of energy....
...23) Which of the following statements by...
...owner refers to the law of diminishing...
...law of diminishing marginal returns? A) "The...
...marginal returns? A) "The higher the quality...
...A) "The higher the quality of the...
...the quality of the ingredients we use,...
...ingredients we use, the higher the cost...
...use, the higher the cost of producing...
..."If we double the size of our...
...=we can increase the number of meals...
..."We can increase the number of meals...
...less meals than the previous worker because...
...because traffic in the kitchen will get...
..."We can serve the same number of...
..."We can serve the same number of...
...Answer: C 25) Marginal cost is calculated...
...by output. B) the increase in total...
...cost divided by the increase in output....
...in output. C) the increase in total...
...cost divided by the increase in labour...
...labour input, given the amount of capital....
...fixed cost. E) the increase in total...
...cost divided by the increase in variable...
...B 7 Use the table below to...
...below to answer the following question(s). Table...
...total cost schedule. The average fixed cost...
...total cost schedule. The average total cost...
...to 9 sweaters, the marginal cost of...
...9 sweaters, the marginal cost of one...
...of one of the 5 sweaters is...
...E 8 Use the figure below to...
...below to answer the following question(s). Figure...
...10.5, which illustrates the short-run average and...
...short-run average and marginal cost curves. The...
...marginal cost curves. The average variable cost...
...is represented by the curve labelled A)...
...E) none of the above. Answer: B...
...a minimum at the same output at...
...a minimum. C) marginal product is at...
...a maximum. D) marginal product is at...
...a minimum. E) marginal cost is at...
...Answer: A 31) The range over which...
...is decreasing is the same as the...
...the same as the range over which...
...over which A) marginal cost is increasing....
...is decreasing. C) marginal product is decreasing....
...E 9 32) The vertical distance between...
...vertical distance between the TC and TVC...
...Answer: D 33) The marginal cost (MC)...
...D 33) The marginal cost (MC) curve...
...(MC) curve intersects the A) ATC, AVC,...
...Answer: D 34) Marginal cost is the...
...Marginal cost is the amount that A)...
...Answer: D 35) Marginal cost can be...
...Answer: E 38) The AFC curve shifts...
...D) all of the above. E) none...
...E) none of the above. Answer: E...
...E) none of the above. Answer: E...
...E) none of the above. Answer: E...
...E 41) In the long run, A)...
...run, A) only the scale of plant...
...E) none of the above is true....
...are present when the percentage change in...
...output A) exceeds the percentage change in...
...is less than the percentage change in...
...fudge. This indicates the presence of A)...
...market constraints. E) the law of diminishing...
...are increased at the same rate, A)...
...cost increases at the same rate as...
...cost rises at the same rate as...
...cars. This indicates the presence of A)...
...of scale. D) the law of diminishing...
...A 12 Use the figure below to...
...below to answer the following question(s). Figure...
...10.7, which illustrates the short-run average total...
...Which curve represents the average total cost...
...total cost for the largest of the...
...the largest of the four plant sizes?...
...10.7, which illustrates the short-run average total...
...Which plant has the lowest average total...
...E) none of the above Answer: A...
...A 13 Use the figure below to...
...below to answer the following question(s). Figure...
...B 14 Use the figure below to...
...below to answer the following question(s). Figure...
...10.9, which illustrates the long-run average total...
...C 50) Complete the following sentence. Long-run...
...cost is A) the same as long-run...
...variable cost. B) the same as long-run...