Question 1

If the average total cost curve is falling, what is necessarily true of the marginal cost curve? If the average total cost curve is rising, what is necessarily true of the marginal cost curve?

Accepted Answer

When the average total cost cu...

Question 2

The adage 'Jack of all trades, master of none' helps explain why some firms experience economies of scale.

Accepted Answer

A) True 
 B)False

Question 3

When a factory is operating in the short run:

Accepted Answer

A)  total cost and variable cost are usually the same
B)  average fixed cost rises as output increases
C)  it cannot adjust the quantity of fixed inputs
D)  it cannot alter variable costsE) All of the above
F) C) and D)

Question 4

Table 13-2
Adrienne's Premium Boxing Service subcontracts with a chocolate manufacturer to box premium chocolates for their mail order catalogue business.Adrienne rents a small room for $150 a week in the downtown business district that serves as her factory.She can hire workers for $275 a week.Costs are in dollars per week. 
-Refer to Table 13-2.What is the marginal product of the fourth worker?

Accepted Answer

A)  40
B)  110
C)  260
D)  275E) C) and D)
F) All of the above

Question 5

Graph 13-5  The set of curves above reflect information about the cost structure of a firm.Use this graph to answer the following question(s) .
-Refer to Graph 13-5.Which of the curves is most likely to represent average variable cost?

Accepted Answer

A)  A
B)  B
C)  C
D)  DE) A) and B)
F) C) and D)

Question 6

Table 13-2
Adrienne's Premium Boxing Service subcontracts with a chocolate manufacturer to box premium chocolates for their mail order catalogue business.Adrienne rents a small room for $150 a week in the downtown business district that serves as her factory.She can hire workers for $275 a week.Costs are in dollars per week. 
-Refer to Table 13-2.What is the total cost associated with making 890 boxes of premium chocolates per week?

Accepted Answer

A)  $975
B)  $1100
C)  $1250
D)  $1375E) A) and D)
F) B) and C)

Question 7

The law of supply states that:

Accepted Answer

A)  the supply curve slopes downward
B)  the demand curve slopes upwards
C)  firms are willing to produce a greater quantity of a good when the price of the good is higher
D)  supply creates its own demandE) A) and B)
F) A) and C)

Question 8

According to the information provided, which of the following statements is(are)  true of Jack's marginal cost?
(i)  his marginal cost curve is U-shaped
(ii)  his marginal cost increases with increased watermelon output
(iii)  his marginal cost reflects diminishing marginal product

Accepted Answer

A)  (i)  and (ii) 
B)  (ii)  and (iii) 
C)  (i)  and (iii) 
D)  (i) , (ii)  and (iii) E) B) and C)
F) A) and B)

Question 9

Economies of scale occur when:

Accepted Answer

A)  long-run average total costs rise as output increases
B)  average fixed costs are falling
C)  long-run average total costs fall as output increases
D)  average fixed costs are constantE) B) and D)
F) All of the above

Question 10

An important implicit cost of almost every business is the:

Accepted Answer

A)  cost of accounting services
B)  cost of compliance with government regulation
C)  opportunity cost of financial capital that has been invested in the business
D)  cost of debtE) A) and B)
F) A) and C)

Question 11

An economist measures profit as:

Accepted Answer

A)  total revenue minus opportunity costs
B)  total revenue minus explicit costs
C)  total revenue minus fixed costs and explicit costs
D)  total revenue minus fixed costs and wagesE) B) and C)
F) B) and D)

Exam 13: The Costs of Production

An important implicit cost of almost every business is the:

Correct Answer
verified

An economist measures profit as:

Correct Answer
verified

The adage 'Jack of all trades, master of none' helps explain why some firms experience economies of scale.

Correct Answer
verified

Graph 13-5 The set of curves above reflect information about the cost structure of a firm.Use this graph to answer the following question(s) . -Refer to Graph 13-5.Which of the curves is most likely to represent average variable cost?

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

The law of supply states that:

Correct Answer
verified

When a factory is operating in the short run:

Correct Answer
verified

Economies of scale occur when:

Correct Answer
verified

According to the information provided, which of the following statements is(are) true of Jack's marginal cost? (i) his marginal cost curve is U-shaped (ii) his marginal cost increases with increased watermelon output (iii) his marginal cost reflects diminishing marginal product

Correct Answer
verified

If the average total cost curve is falling, what is necessarily true of the marginal cost curve? If the average total cost curve is rising, what is necessarily true of the marginal cost curve?

Correct Answer
verified
When the average total cost cu...
View Answer

Exam 13: The Costs of Production

An important implicit cost of almost every business is the:

Correct AnswerverifiedShow Answer

An economist measures profit as:

Correct AnswerverifiedShow Answer

The adage 'Jack of all trades, master of none' helps explain why some firms experience economies of scale.

Correct AnswerverifiedShow Answer

Graph 13-5 The set of curves above reflect information about the cost structure of a firm.Use this graph to answer the following question(s) . -Refer to Graph 13-5.Which of the curves is most likely to represent average variable cost?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The law of supply states that:

Correct AnswerverifiedShow Answer

When a factory is operating in the short run:

Correct AnswerverifiedShow Answer

Economies of scale occur when:

Correct AnswerverifiedShow Answer

According to the information provided, which of the following statements is(are) true of Jack's marginal cost? (i) his marginal cost curve is U-shaped (ii) his marginal cost increases with increased watermelon output (iii) his marginal cost reflects diminishing marginal product

Correct AnswerverifiedShow Answer

If the average total cost curve is falling, what is necessarily true of the marginal cost curve? If the average total cost curve is rising, what is necessarily true of the marginal cost curve?

Correct AnswerverifiedWhen the average total cost cu...View AnswerShow 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
When the average total cost cu...
View Answer