FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 13: The Costs of Production

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 91

Short Answer

Review LaterAdd Note

Review Later

Average variable cost will decrease if __________.

Correct Answer

verified

marginal c...

View Answer

Show Answer

Question 92

Multiple Choice

Review LaterAdd Note

Review Later

Total cost is the

A) amount a firm receives for the sale of its output.
B) fixed cost less variable cost.
C) market value of the inputs a firm uses in production.
D) quantity of output minus the quantity of inputs used to make a good.

E) C) and D)
F) B) and C)

Correct Answer

verified

Show Answer

Question 93

True/False

Review LaterAdd Note

If a firm produces nothing, it still incurs its fixed costs.

Table 13-13 Teacher's Helper is a small company that has a subcontract to produce instructional materials for disabled children in public school districts. The owner rents several small rooms in an office building in the suburbs for $600 a month and has leased computer equipment that costs $480 a month. -Refer to Table 13-13. How many instructional modules are produced when marginal cost is $1,300?

Table 13-16 Listed in the table are the long-run total costs for three different firms. -Refer to Table 13-16. Which firm is experiencing constant returns to scale?

For a large firm that produces and sells automobiles, which of the following costs would be a variable cost?

A firm that wants to achieve economies of scale could do so by

Adam Smith's example of the pin factory demonstrates that economies of scale result from specialization.

The typical total-cost curve is U-shaped.

Describe the relationship between average variable cost and average total cost. How are the general shapes of the AVC and ATC curves related?

Table 13-6 Wooden Chair Factory -Refer to Table 13-6. Each worker at the Wooden Chair Factory costs $12 per hour. The cost of each machine is $20 per day regardless of the number of chairs produced. What is the total daily cost of producing at a rate of 55 chairs per hour if the factory operates 8 hours per day?

Figure 13-3 -Refer to Figure 13-3. The graph illustrates a typical total cost curve. Based on its shape, what does the corresponding production function look like?

Economies of scale occur when a firm's

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

Which of the following expressions is correct?

Economies of scale arise when

Which of the following explains why long-run average cost at first decreases as output increases?

Economists normally assume that the goal of a firm is to earn (i) profits as large as possible, even if it means reducing output. (ii) profits as large as possible, even if it means incurring a higher total cost. (iii) revenues as large as possible, even if it reduces profits.

The Big Blue Sky jet company has long-run total costs of $20 million if it produces 5 jets and long-run total costs of $24 million if it produces 6 jets. The Big Blue Sky jet company is experiencing

Scenario 13-16 Barney builds custom wooden birdhouses. He can make 150 birdhouses per month and sell them for $50 each. His average total cost is $30 per birdhouse. -Refer to Scenario 13-16. Barney is considering hiring his best friend Fred to work for him. Fred can build 125 birdhouses per month. If Barney hires Fred, what will be the monthly total output of his birdhouse business?