...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...
...able to maximize total profit. C) the...
...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...
...marginal product of the last unit of...
...last unit of the input employed exceeds...
...input employed exceeds the marginal product of...
...marginal product of the previous unit. E)...
...Answer: C 4) The total product curve...
...C 4) The total product curve is...
...a graph of the A) minimum cost...
...E) change in total product for a...
...C 1 Use the figure below to...
...below to answer the following question(s). Figure...
...which illustrates Swanky's total product curve. Which...
...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....
...illustrates Swanky's short-run total product curve. Which...
...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...
...Marginal product is the change in total...
...the change in total product caused by...
...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...
...which represents Swanky's total product curve. The...
...total product curve. The marginal product that...
...be produced if the firm employed four...
...Answer: E Use the table below to...
...below to answer the following question(s). Table...
...which represents Swanky's total product curve. The...
...total product curve. The average product that...
...be produced if the firm employed four...
...to 15 sweaters. The marginal product of...
...marginal product of the third worker is...
...a firm increases the total units of...
...firm increases the total units of labour...
...as a result, the firm's total output...
...result, the firm's total output increases from...
...to 400 units. The marginal product of...
...marginal product of the sixth worker is...
...negative. B) is the slope of the...
...the slope of the total product curve....
...slope of the total product curve. C)...
...average product minus total product. Answer: B...
...B 13) If the total product of...
...13) If the total product of three...
...is 214 and the total product of...
...214 and the total product of four...
...is 221, then the marginal product of...
...marginal product of the fourth worker is...
...a situation where the ________ of the...
...the ________ of the last worker hired...
...falls short of the ________ of the...
...the ________ of the previous worker. A)...
...4 15) When the marginal product of...
...is greater than the average product of...
...of labour, A) the average product of...
...is increasing. B) the marginal product of...
...is increasing. C) the total product curve...
...increasing. C) the total product curve is...
...negatively sloped. D) the firm is experiencing...
...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...
...C 19) Suppose the marginal product of...
...is less than the average product of...
...implies that A) the marginal product is...
...product is equal the average product. B)...
...average product. B) the marginal product is...
...is greater than the average product at...
...each level of the input used. C)...
...input used. C) the marginal product curve...
...upward sloping. D) the average product curve...
...sloping. E) both the marginal and average...
...E 20) Suppose the marginal product of...
...of energy equals the average product of...
...is maximized. D) the marginal product curve...
...Which one of the following statements is...
...product is zero, total product is minimized....
...Answer: C 22) The average product of...
...energy is A) the increase in total...
...the increase in total product divided by...
...product divided by the increase in energy...
...energy used. B) the total product divided...
...used. B) the total product divided by...
...product divided by the quantity of energy...
...energy used. C) the slope of the...
...the slope of the total product curve....
...slope of the total product curve. D)...
...product curve. D) the slope of the...
...the slope of the marginal product curve....
...product curve. E) the difference between the...
...the difference between the total product and...
...difference between the total product and marginal...
...23) Which of the following statements by...
...owner refers to the law of diminishing...
...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 24) Total fixed cost can...
...calculated as A) total cost divided by...
...by output. B) the increase in total...
...the increase in total cost divided by...
...cost divided by the increase in output....
...in output. C) the increase in total...
...the increase in total cost divided by...
...cost divided by the increase in labour...
...labour input, given the amount of capital....
...of capital. D) total variable cost minus...
...variable cost minus total fixed cost. E)...
...fixed cost. E) the increase in total...
...the increase in total cost divided by...
...cost divided by the increase in variable...
...B 7 Use the table below to...
...below to answer the following question(s). Table...
...represents Swanky's short-run total cost schedule. The...
...total cost schedule. The average fixed cost...
...represents Swanky's short-run total cost schedule. The...
...total cost schedule. The average total cost...
...schedule. The average total cost of producing...
...represents Swanky's short-run total cost schedule. When...
...to 9 sweaters, the marginal cost of...
...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...
...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...
...Answer: A 31) The range over which...
...is decreasing is the same as the...
...the same as the range over which...
...E 9 32) The vertical distance between...
...vertical distance between the TC and TVC...
...Answer: D 33) The marginal cost (MC)...
...(MC) curve intersects the A) ATC, AVC,...
...Marginal cost is the amount that A)...
...amount that A) total cost increases when...
...is hired. D) total cost increases when...
...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)...
...same rate, A) total output remains constant....
...constant. B) average total cost remains constant....
...constant. C) average total cost increases at...
...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...
...the short-run average total cost curves for...
...Which curve represents the average total cost...
...represents the average total cost for the...
...total cost for the largest of the...
...the largest of the four plant sizes?...
...10.7, which illustrates the short-run average total...
...the short-run average total cost curves for...
...Which plant has the lowest average total...
...the lowest average total cost for an...
...E) none of the above Answer: A...
...A 13 Use the figure below to...
...below to answer the following question(s). Figure...
...firm's long-run average total cost of production....
...scale. D) constant total costs. E) constant...
...B 14 Use the figure below to...
...below to answer the following question(s). Figure...
...10.9, which illustrates the long-run average total...
...the long-run average total cost of production...
...C 50) Complete the following sentence. Long-run...
...following sentence. Long-run total cost is A)...
...cost is A) the same as long-run...
...same as long-run total variable cost. B)...
...variable cost. B) the same as long-run...
...same as long-run total fixed cost. C)...
...equal to long-run total fixed cost plus...
...equal to long-run total fixed cost minus...
...equal to short-run total cost. Answer: A...