Question 1

When a factory is operating in the short run,

Accepted Answer

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

Question 2

Table 13-10 
-Refer to Table 13-10. The average total cost of producing 240 units is

Accepted Answer

A)  $0.06.
B)  $0.38.
C)  $0.44.
D)  $30.E) All of the above
F) C) and D)

Question 3

Table 13-9 
-Refer to Table 13-9. The marginal products of hiring additional workers are

Accepted Answer

A)  increasing at an increasing rate.
B)  increasing at a decreasing rate.
C)  decreasing.
D)  constant.E) B) and D)
F) All of the above

Question 4

Suppose that Danita owns a cupcake bakery. In the short run, at least one of her inputs is fixed. Provide one or two examples of the types of inputs that could be fixed in the short run.

Accepted Answer

Danita's store size is likely to be fixe...

Question 5

A student might describe information about the costs of production as

Accepted Answer

A)  dry and technical.
B)  boring.
C)  crucial to understanding firms and market structures.
D)  All of the above could be correct.E) A) and B)
F) A) and C)

Question 6

Table 13-11 
-Refer to Table 13-11. What is the variable cost of producing 5 posters?

Accepted Answer

A)  $13
B)  $14
C)  $15
D)  It can't be determined from the information given.E) A) and B)
F) A) and D)

Question 7

Table 13-20
Listed in the table are the long-run total costs for three different firms. 
-Refer to Table 13-20. Firm B is experiencing constant returns to scale.

Accepted Answer

A) True 
 B)False

Question 8

When adding another unit of labor leads to an increase in output that is smaller than the increases in output that resulted from adding previous units of labor, the firm is experiencing

Accepted Answer

A)  diminishing labor.
B)  diminishing output.
C)  diminishing marginal product.
D)  negative marginal product.E) A) and B)
F) A) and C)

Question 9

The nature of a firm's cost (fixed or variable)  depends on the

Accepted Answer

A)  firm's revenues.
B)  time horizon under consideration.
C)  price the firm charges for output.
D)  explicit but not implicit costs.E) A) and B)
F) All of the above

Question 10

Scenario 13-14
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 13-14. Farmer Brown's production function exhibits

Accepted Answer

A)  increasing marginal product.
B)  constant marginal product.
C)  diminishing marginal product.
D)  The production function is unrelated to the marginal product.E) A) and C)
F) A) and B)

Question 11

Katherine gives piano lessons for $15 per hour. She also grows flowers, which she arranges and sells at the local farmer's market. One day she spends 5 hours planting $50 worth of seeds in her garden. Once the seeds have grown into flowers, she can sell them for $150 at the farmer's market. Katherine's accounting profits are

Accepted Answer

A)  $100, and her economic profits are $25.
B)  $100, and her economic profits are $75.
C)  $25, and her economic profits are $100.
D)  $75, and her economic profits are $125.E) B) and C)
F) C) and D)

Question 12

David's firm experiences diminishing marginal product for all ranges of inputs. The total cost curve associated with David's firm

Accepted Answer

A)  gets flatter as output increases.
B)  gets steeper as output increases.
C)  is constant for all ranges of output.
D)  is unrelated to the production function.E) A) and D)
F) None of the above

Question 13

Figure 13-2 
-Refer to Figure 13-2. As the number of workers increases,

Accepted Answer

A)  marginal product decreases.
B)  total output decreases.
C)  marginal product increases but at a decreasing rate.
D)  Both a and b are correct.E) A) and C)
F) A) and B)

Question 14

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

Accepted Answer

A)  $50
B)  $140
C)  $360
D)  $410E) B) and C)
F) All of the above

Question 15

If the total cost curve gets steeper as output increases, the firm is experiencing

Accepted Answer

A)  diseconomies of scale.
B)  economies of scale.
C)  diminishing marginal product.
D)  increasing marginal product.E) B) and C)
F) None of the above

Question 16

Describe how an accounting firm could experience diseconomies of scale.

Accepted Answer

Problems with coordination can cause dis...

Question 17

The cost of producing an additional unit of output is the firm's

Accepted Answer

A)  marginal cost.
B)  productivity offset.
C)  variable cost.
D)  average variable cost.E) A) and D)
F) B) and C)

Question 18

Table 13-5 
-Refer to Table 13-5. The marginal product of the fourth worker is

Accepted Answer

A)  9,000 units.
B)  8,000 units.
C)  7,000 units.
D)  5,000 units.E) None of the above
F) All of the above

Question 19

In the long run, a firm that produces and sells textbooks gets to choose

Accepted Answer

A)  how many workers to hire.
B)  the size of its factories.
C)  which short-run average-total-cost curve to use.
D)  All of the above are correct.E) A) and D)
F) All of the above

Question 20

Define profit.

Accepted Answer

Profit = T...

Exam 13: The Costs of Production

Describe how an accounting firm could experience diseconomies of scale.

Correct Answer
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Problems with coordination can cause dis...
View Answer

Table 13-10 -Refer to Table 13-10. The average total cost of producing 240 units is

Correct Answer
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When a factory is operating in the short run,

Correct Answer
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The cost of producing an additional unit of output is the firm's

Correct Answer
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David's firm experiences diminishing marginal product for all ranges of inputs. The total cost curve associated with David's firm

Correct Answer
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Correct Answer
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The nature of a firm's cost (fixed or variable) depends on the

Correct Answer
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Table 13-9 -Refer to Table 13-9. The marginal products of hiring additional workers are

Correct Answer
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Define profit.

Correct Answer
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Profit = T...
View Answer

Figure 13-2 -Refer to Figure 13-2. As the number of workers increases,

Correct Answer
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If the total cost curve gets steeper as output increases, the firm is experiencing

Correct Answer
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A student might describe information about the costs of production as

Correct Answer
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When adding another unit of labor leads to an increase in output that is smaller than the increases in output that resulted from adding previous units of labor, the firm is experiencing

Correct Answer
verified

Suppose that Danita owns a cupcake bakery. In the short run, at least one of her inputs is fixed. Provide one or two examples of the types of inputs that could be fixed in the short run.

Correct Answer
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Danita's store size is likely to be fixe...
View Answer

Table 13-5 -Refer to Table 13-5. The marginal product of the fourth worker is

Correct Answer
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In the long run, a firm that produces and sells textbooks gets to choose

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

Correct Answer
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Table 13-20 Listed in the table are the long-run total costs for three different firms. -Refer to Table 13-20. Firm B is experiencing constant returns to scale.

Correct Answer
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Correct Answer
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Table 13-11 -Refer to Table 13-11. What is the variable cost of producing 5 posters?

Correct Answer
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Exam 13: The Costs of Production

Describe how an accounting firm could experience diseconomies of scale.

Correct AnswerverifiedProblems with coordination can cause dis...View AnswerShow Answer

Table 13-10 -Refer to Table 13-10. The average total cost of producing 240 units is

Correct AnswerverifiedShow Answer

When a factory is operating in the short run,

Correct AnswerverifiedShow Answer

The cost of producing an additional unit of output is the firm's

Correct AnswerverifiedShow Answer

David's firm experiences diminishing marginal product for all ranges of inputs. The total cost curve associated with David's firm

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The nature of a firm's cost (fixed or variable) depends on the

Correct AnswerverifiedShow Answer

Table 13-9 -Refer to Table 13-9. The marginal products of hiring additional workers are

Correct AnswerverifiedShow Answer

Define profit.

Correct AnswerverifiedProfit = T...View AnswerShow Answer

Figure 13-2 -Refer to Figure 13-2. As the number of workers increases,

Correct AnswerverifiedShow Answer

If the total cost curve gets steeper as output increases, the firm is experiencing

Correct AnswerverifiedShow Answer

A student might describe information about the costs of production as

Correct AnswerverifiedShow Answer

When adding another unit of labor leads to an increase in output that is smaller than the increases in output that resulted from adding previous units of labor, the firm is experiencing

Correct AnswerverifiedShow Answer

Suppose that Danita owns a cupcake bakery. In the short run, at least one of her inputs is fixed. Provide one or two examples of the types of inputs that could be fixed in the short run.

Correct AnswerverifiedDanita's store size is likely to be fixe...View AnswerShow Answer

Table 13-5 -Refer to Table 13-5. The marginal product of the fourth worker is

Correct AnswerverifiedShow Answer

In the long run, a firm that produces and sells textbooks gets to choose

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Table 13-20 Listed in the table are the long-run total costs for three different firms. -Refer to Table 13-20. Firm B is experiencing constant returns to scale.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 13-11 -Refer to Table 13-11. What is the variable cost of producing 5 posters?

Correct AnswerverifiedShow Answer

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Problems with coordination can cause dis...
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Profit = T...
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Danita's store size is likely to be fixe...
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