Question 1

Table 13-5
The Flying Elvis Copter Rides
 
-Refer to Table 13-5.What is the value of B?

Accepted Answer

A)   $25
B)   $50
C)   $100
D)   $200E) A) and B)
F) A) and C)

Question 2

Accountants keep track of the money that flows into and out of firms.

Accepted Answer

A) True 
 B)False

Question 3

Table 13-12
Listed in the table are the long-run total costs for three different firms.
 
-Refer to Table 13-12.Which firm is experiencing diseconomies of scale?

Accepted Answer

A)   Firm A only
B)   Firm B only
C)   Firm C only
D)   Firm A and Firm B onlyE) B) and C)
F) A) and C)

Question 4

Figure 13-6 
-Refer to Figure 13-6.Which of the figures represents the marginal cost curve for a firm?

Accepted Answer

A)   Figure 1
B)   Figure 2
C)   Figure 3
D)   Figure 4E) A) and C)
F) B) and C)

Question 5

Diseconomies of scale occur when

Accepted Answer

A)   average fixed costs are falling.
B)   average fixed costs are constant.
C)   long-run average total costs rise as output increases.
D)   long-run average total costs fall as output increases.E) A) and C)
F) A) and B)

Question 6

As a firm moves along its long-run average cost curve,it is adjusting the size of its factory to the quantity of production.

Accepted Answer

A) True 
 B)False

Question 7

Average total cost is very high when a small amount of output is produced because

Accepted Answer

A)   average variable cost is high.
B)   average fixed cost is high.
C)   marginal cost is high.
D)   marginal product is high.E) None of the above
F) A) and B)

Question 8

The amount of money that a firm receives from the sale of its output is called

Accepted Answer

A)   total gross profit.
B)   total net profit.
C)   total revenue.
D)   net revenue.E) C) and D)
F) A) and D)

Question 9

Scenario 13-3
Tony is a wheat farmer,but he also spends part of his day teaching guitar lessons.Due to the popularity of his local country western band,Farmer Tony has more students requesting lessons than he has time for if he is to also maintain his farming business.Farmer Tony charges $25 an hour for his guitar lessons.One spring day,he spends 10 hours in his fields planting $130 worth of seeds on his farm.He expects that the seeds he planted will yield $300 worth of wheat.
-Refer to Scenario 13-3.Tony's economic profit equals

Accepted Answer

A)   $-130.
B)   $-80.
C)   $130.
D)   $170.E) None of the above
F) A) and B)

Question 10

Table 13-1
Alyson's Pet Sitting Service
 
-Refer to Table 13-1.What is the marginal product of the second worker?

Accepted Answer

A)   15
B)   20
C)   22.5
D)   25E) A) and D)
F) All of the above

Question 11

A firm has a fixed cost of $200 in its first year of operation.When the firm produces 99 units of output,its total costs are $4,000.The marginal cost of producing the 100th unit of output is $700.What is the total cost of producing 100 units?

Accepted Answer

A)   $900
B)   $4,200
C)   $4,700
D)   $4,900E) C) and D)
F) A) and B)

Question 12

Marginal cost is equal to average total cost when

Accepted Answer

A)   average variable cost is falling.
B)   average fixed cost is rising.
C)   marginal cost is at its minimum.
D)   average total cost is at its minimum.E) A) and C)
F) C) and D)

Question 13

Table 13-3
 
-Refer to Table 13-3.What is total output when 3 workers are hired?

Accepted Answer

A)   30
B)   40
C)   70
D)   120E) All of the above
F) B) and C)

Question 14

Figure 13-3 
-Refer to Figure 13-3.Which of the following statements best captures the nature of the underlying production function?

Accepted Answer

A)   Output increases at a decreasing rate with additional units of input.
B)   Output increases at an increasing rate with additional units of input.
C)   Output decreases at a decreasing rate with additional units of input.
D)   Output decreases at an increasing rate with additional units of input.E) A) and C)
F) A) and D)

Question 15

Marginal costs are costs that do not vary with the quantity of output produced.

Accepted Answer

A) True 
 B)False

Question 16

Table 13-5
The Flying Elvis Copter Rides
 
-Refer to Table 13-5.What is the value of A?

Accepted Answer

A)   $25
B)   $50
C)   $100
D)   $200E) B) and C)
F) C) and D)

Question 17

Table 13-7
 
-Refer to Table 13-7.The average total cost of producing one widget is

Accepted Answer

A)   $1.00.
B)   $10.00.
C)   $11.00.
D)   $22.00.E) A) and B)
F) A) and C)

Question 18

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 D)
F) None of the above

Question 19

Which of the following statements is correct?

Accepted Answer

A)   If marginal cost is rising,then average total cost is rising.
B)   If marginal cost is rising,then average variable cost is rising.
C)   If average variable cost is rising,then marginal cost is minimized.
D)   If average total cost is rising,then marginal cost is greater than average total cost.E) C) and D)
F) B) and C)

Question 20

If Kelsey sells 300 glasses of lemonade at $0.50 each,her total revenues are

Accepted Answer

A)   $150.
B)   $299.50.
C)   $300.
D)   $600.E) B) and D)
F) A) and B)

Exam 13: The Costs of Production

Diseconomies of scale occur when

Correct Answer
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Marginal cost is equal to average total cost when

Correct Answer
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Table 13-12 Listed in the table are the long-run total costs for three different firms. -Refer to Table 13-12.Which firm is experiencing diseconomies of scale?

Correct Answer
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A firm has a fixed cost of $200 in its first year of operation.When the firm produces 99 units of output,its total costs are $4,000.The marginal cost of producing the 100th unit of output is $700.What is the total cost of producing 100 units?

Correct Answer
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The amount of money that a firm receives from the sale of its output is called

Correct Answer
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Marginal costs are costs that do not vary with the quantity of output produced.

Correct Answer
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Figure 13-3 -Refer to Figure 13-3.Which of the following statements best captures the nature of the underlying production function?

Correct Answer
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Table 13-3 -Refer to Table 13-3.What is total output when 3 workers are hired?

Correct Answer
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Accountants keep track of the money that flows into and out of firms.

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 13-7 -Refer to Table 13-7.The average total cost of producing one widget is

Correct Answer
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If Kelsey sells 300 glasses of lemonade at $0.50 each,her total revenues are

Correct Answer
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Average total cost is very high when a small amount of output is produced because

Correct Answer
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As a firm moves along its long-run average cost curve,it is adjusting the size of its factory to the quantity of production.

Correct Answer
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Table 13-5 The Flying Elvis Copter Rides -Refer to Table 13-5.What is the value of A?

Correct Answer
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Table 13-1 Alyson's Pet Sitting Service -Refer to Table 13-1.What is the marginal product of the second worker?

Correct Answer
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Which of the following statements is correct?

Correct Answer
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Figure 13-6 -Refer to Figure 13-6.Which of the figures represents the marginal cost curve for a firm?

Correct Answer
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Table 13-5 The Flying Elvis Copter Rides -Refer to Table 13-5.What is the value of B?

Correct Answer
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Exam 13: The Costs of Production

Diseconomies of scale occur when

Correct AnswerverifiedShow Answer

Marginal cost is equal to average total cost when

Correct AnswerverifiedShow Answer

Table 13-12 Listed in the table are the long-run total costs for three different firms. -Refer to Table 13-12.Which firm is experiencing diseconomies of scale?

Correct AnswerverifiedShow Answer

A firm has a fixed cost of $200 in its first year of operation.When the firm produces 99 units of output,its total costs are $4,000.The marginal cost of producing the 100th unit of output is $700.What is the total cost of producing 100 units?

Correct AnswerverifiedShow Answer

The amount of money that a firm receives from the sale of its output is called

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Marginal costs are costs that do not vary with the quantity of output produced.

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Figure 13-3 -Refer to Figure 13-3.Which of the following statements best captures the nature of the underlying production function?

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Table 13-3 -Refer to Table 13-3.What is total output when 3 workers are hired?

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Accountants keep track of the money that flows into and out of firms.

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

Correct AnswerverifiedShow Answer

Table 13-7 -Refer to Table 13-7.The average total cost of producing one widget is

Correct AnswerverifiedShow Answer

If Kelsey sells 300 glasses of lemonade at $0.50 each,her total revenues are

Correct AnswerverifiedShow Answer

Average total cost is very high when a small amount of output is produced because

Correct AnswerverifiedShow Answer

As a firm moves along its long-run average cost curve,it is adjusting the size of its factory to the quantity of production.

Correct AnswerverifiedShow Answer

Table 13-5 The Flying Elvis Copter Rides -Refer to Table 13-5.What is the value of A?

Correct AnswerverifiedShow Answer

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Table 13-1 Alyson's Pet Sitting Service -Refer to Table 13-1.What is the marginal product of the second worker?

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Which of the following statements is correct?

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Figure 13-6 -Refer to Figure 13-6.Which of the figures represents the marginal cost curve for a firm?

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Table 13-5 The Flying Elvis Copter Rides -Refer to Table 13-5.What is the value of B?

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