question
What is the full name of TVC?
answer
Total Variable Cost
question
What should be on the horizontal axis of TVC?
answer
output
question
If TFC when y = 10,000 bu is $100, then when y = 5000 bu TFC will be
answer
$100
question
Total Fixed Cost graph will be
answer
a straight horizontal line parallel to the horizontal axis
question
What is the equation for determining Average Variable Cost?
answer
Total Variable Cost/Y
question
What is the equation for determining Marginal Cost?
answer
Change in Total Cost/Change In Y
question
The graph of Average Total Cost will have what on the horizontal axis?
answer
output
question
If Input (X) is in gallons, Output (Y) is in bushels and Total Cost is in dollars, what are the units on Average Total Cost?
answer
$/bushel
question
Economists are:
answer
profit maximizers
question
If ATC is $25/lb and MC is $50/lb, you know that
answer
ATC is increasing
question
Perfect Competition includes
answer
Homogeneous Products, Perfect Information, Small Size Sellers Relative To the Total Market
question
Producers in perfect competition are
answer
price takers
question
Assuming a typical 3-stage production process, the average total cost should
answer
decrease then increase
question
What is the equation to compute profit?
answer
TRP - TFactorC = Profit
question
TRP is an abbreviation for?
answer
Total Revenue Product
question
TRP is in what units?
answer
dollars
question
What are the units for MFC?
answer
$/unit of input
question
What has a similar shape to the TPP when graped?
answer
TRP
question
If Price of X = 1, Price of Y = 2, and TPP = 8, then:
answer
MFC = 1
question
What is the number of units of the variable input multiplied by the price of the input?
answer
Total Factor Cost
question
If MRP > MFC, the profit-maximizing producer will
answer
increase the amount of input
question
What are the units for TRP?
answer
dollars
question
At the optimal level of input use
answer
the producer is doing the best he/she can
question
If production technology changes, the following will happen in the profit maximization problem:
answer
the shape of TPP curve will change so TRP will change
question
If MPP = 10, Price of x = 2 and price of y = 3, then:
answer
MRP = 30
question
If the price (cost) of the variable input (price of x) increases significantly ceteris paribus, the profit maximizing producer will:
answer
use less variable input and produce less output
question
MR is equal to
answer
price of output Y
question
MC is equal to
answer
change in TC over change in Y
question
What are the units for MC?
answer
$/unit of y
question
Negative Profit occurs when
answer
MR < ATC
question
Breakeven point is when
answer
MR = Min ATC = MC
question
What is the denominator of the average variable cost equation?
answer
ouput
question
In the short run, a firm will shut down if
answer
price of y < min AVC
question
If MC is $30/lb and ATC is $50/lb, you know that?
answer
ATC is decreasing
question
MR is calculated in a different way than MRP?
answer
True
question
With a typical production process, if total cost is spread over increasing output, average total cost will:
answer
decrease then increase
question
The units for MRP are?
answer
$/unit of input
question
The units for MC are
answer
$/unit of output
question
MRP is equal to
answer
MPP(Price of Y)
question
As levels of output increases, average fixed costs will
answer
decrease
question
If MRP > MFC then the rational producers will
answer
increase input usage one unit at a time until MRP = MFC
question
At the profit maximizing level of output
answer
the producer is doing the best he/she can
question
In the long run, a firm will shut down when
answer
price of y < min ATC
question
If price of Y is between ATC and AVC at profit-maximizing level of output
answer
all variable costs are covered and some fixed costs are covered
question
If Y = 20, price of x =2 and price of y = 3
answer
TRP = 60
question
What is on the horizontal axis of the avc and atc?
answer
output
question
Write the equation for mc
answer
change in total cost / change in y
question
What is the full name of MRP?
answer
Marginal Revenue Product
question
What is the equation for MRP?
answer
MPP(Py) or change in TRP/change in x
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