AP Econ Topic 10 Test Review - Assignment Essays

question

The implicit cost of capital is

answer

the opportunity cost of capital used by a business

question

Sarah's accountant tells her that she made a profit of 43,002 running a pottery studio in Orlando. Sarah's husband- an economist- claims Sarah lost 43,002 running her pottery studio. This means her husband is claiming that she incurred ______ in ______ costs

answer

$86,004; implicit

question

Accounting profit differs from economic profit because:

answer

economic costs are generally higher than accounting costs because economic costs include all opportunity costs, while accounting costs include only explicit costs.

question

Profit is the difference between ______ and ______

answer

total revenues; total costs

question

Pauli's Pizza offers the following prices: one slice for 2$, two slices for 3.50, three slices for 4.50, four slices for 5.00. Sal orders two slices. From this we know that Sal's marginal benefit from the second slice must be at least _____ while the marginal benefit from the third slice must be less than _______.

answer

1.50; 1.00

question

If marginal costs of production are greater than marginal revenue from sales:

answer

too much of the good is being produced

question

The ____ is the increase in output obtained by hiring an additional worker.

answer

marginal product

question

The marginal product of the fifth worker is

answer

question

the average product when four workers are employed is

answer

question

the long run is a planning period

answer

long enough such that a firm can consider all inputs as a variable

question

You own a small deli that produces sandwiches, soups, and other items for customers in your town. Which of the following is a fixed input in the production function at your deli?

answer

the dining room where customers eat their meals

question

The figure shows a production function changing from TP1 to TP2. Which of the following choices is a likely cause of this shift?

answer

the firm employed more of a fixed input in the long run

question

Melanie's printing and copying shop wants to produce more output. In the short run, Melanie can:

answer

hire more workers to operate a third shift

question

A cost that does not change with the level of output produced is called a:

answer

fixed cost

question

The table shows some cost data for a firm currently operating in the short run. What is the value of the total fixed cost for this firm?

answer

$50

question

What is the value of the total variable cost for this firm when the firms is producing five units of output?

answer

$190

question

At what level of output is marginal revenue equal to marginal cost for this seller of gizmos?

answer

question

The short run is always defined as a period that is:

answer

long enough such that output can vary, but plant capacity cannot.

question

An input whose quantity can be changed during the short run is a:

answer

variable input

question

An input whose quantity CANNOT be changed during the short run is a:

answer

fixed input

question

The change in total output resulting from one-unit increase in the quantity of an input used, holding the quantities of all other inputs constant, is:

answer

marginal product

question

Between points A and B the marginal product of labor is:

answer

falling

question

When hiring units of labor between zero and L1 units of labor, which of the following statements is true?

answer

The marginal product of labor is increasing

question

After hiring L2 units of labor and producing at point B on the total product curve, hiring more units of labor would result in which of the following statements being true?

answer

The marginal product of labor is negative

question

Using the information from the table, when quantity increases from one to two, marginal cost equals:

answer

question

Using the information in the table, when quantity equals four, total variable cost equals

answer

question

When quantity equals three, average total cost equals:

answer

question

The _____ curve continually declines as more output is produced in the short run.

answer

average fixed cost

question

In the figure, the total cost of producing five pairs of boots is approximately

answer

$408

question

A is the ____ cost curve

answer

marginal

question

Point E corresponds to the

answer

minimum of average total cost

question

B is the ____ cost curve

answer

average total

question

Point D corresponds to the

answer

intersection of marginal and average variable cost

question

Sunk costs:

answer

are not considered in marginal analysis.

question

The long-run average cost curve will be upward sloping when the firm is experiencing:

answer

diseconomies of scale

question

Output per period in the region from 0 to A indicates that a firm is experiencing:

answer

economies of scale

question

Output per period in the region A to B indicates that a firm is experiencing:

answer

constant returns to scale

question

Output per period in the region B to C indication that a fimr is experiencing

answer

diseconomies of scale

question

If a firm faced a long-run average total cost curve as show in the figure, and it expected to produce 100,000 units of the good in the long run, the firm should build the plant associated with

answer

ATC2

question

In the long run, all costs are:

answer

variable

1 of 40

question

The implicit cost of capital is

answer

the opportunity cost of capital used by a business

question

answer

$86,004; implicit

question

Accounting profit differs from economic profit because:

answer

economic costs are generally higher than accounting costs because economic costs include all opportunity costs, while accounting costs include only explicit costs.

question

Profit is the difference between ______ and ______

answer

total revenues; total costs

question

answer

1.50; 1.00

question

If marginal costs of production are greater than marginal revenue from sales:

answer

too much of the good is being produced

question

The ____ is the increase in output obtained by hiring an additional worker.

answer

marginal product

question

The marginal product of the fifth worker is

answer

question

the average product when four workers are employed is

answer

question

the long run is a planning period

answer

long enough such that a firm can consider all inputs as a variable

question

You own a small deli that produces sandwiches, soups, and other items for customers in your town. Which of the following is a fixed input in the production function at your deli?

answer

the dining room where customers eat their meals

question

The figure shows a production function changing from TP1 to TP2. Which of the following choices is a likely cause of this shift?

answer

the firm employed more of a fixed input in the long run

question

Melanie's printing and copying shop wants to produce more output. In the short run, Melanie can:

answer

hire more workers to operate a third shift

question

A cost that does not change with the level of output produced is called a:

answer

fixed cost

question

The table shows some cost data for a firm currently operating in the short run. What is the value of the total fixed cost for this firm?

answer

$50

question

What is the value of the total variable cost for this firm when the firms is producing five units of output?

answer

$190

question

At what level of output is marginal revenue equal to marginal cost for this seller of gizmos?

answer

question

The short run is always defined as a period that is:

answer

long enough such that output can vary, but plant capacity cannot.

question

An input whose quantity can be changed during the short run is a:

answer

variable input

question

An input whose quantity CANNOT be changed during the short run is a:

answer

fixed input

question

The change in total output resulting from one-unit increase in the quantity of an input used, holding the quantities of all other inputs constant, is:

answer

marginal product

question

Between points A and B the marginal product of labor is:

answer

falling

question

When hiring units of labor between zero and L1 units of labor, which of the following statements is true?

answer

The marginal product of labor is increasing

question

After hiring L2 units of labor and producing at point B on the total product curve, hiring more units of labor would result in which of the following statements being true?

answer

The marginal product of labor is negative

question

Using the information from the table, when quantity increases from one to two, marginal cost equals:

answer

question

Using the information in the table, when quantity equals four, total variable cost equals

answer

question

When quantity equals three, average total cost equals:

answer

question

The _____ curve continually declines as more output is produced in the short run.

answer

average fixed cost

question

In the figure, the total cost of producing five pairs of boots is approximately

answer

$408

question

A is the ____ cost curve

answer

marginal

question

Point E corresponds to the

answer

minimum of average total cost

question

B is the ____ cost curve

answer

average total

question

Point D corresponds to the

answer

intersection of marginal and average variable cost

question

Sunk costs:

answer

are not considered in marginal analysis.

question

The long-run average cost curve will be upward sloping when the firm is experiencing:

answer

diseconomies of scale

question

Output per period in the region from 0 to A indicates that a firm is experiencing:

answer

economies of scale

question

Output per period in the region A to B indicates that a firm is experiencing:

answer

constant returns to scale

question

Output per period in the region B to C indication that a fimr is experiencing

answer

diseconomies of scale

question

If a firm faced a long-run average total cost curve as show in the figure, and it expected to produce 100,000 units of the good in the long run, the firm should build the plant associated with

answer

ATC2

question

In the long run, all costs are:

answer

variable

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