question
True statements about the theory of the firm in the short run and long run include which of the following?
answer
- all input quantities are variable in the long run
- at least one input quantity is fixed in the short run
- at least one input quantity is fixed in the short run
question
which of the following statements about a firms production function are true?
answer
- When total product is at its maximum, marginal product is zero
-when marginal produc is greater that average produc is rising
-when marginal product is less than average product, average product is falling
-when marginal produc is greater that average produc is rising
-when marginal product is less than average product, average product is falling
question
for a perfectly competitive firm, if the market price is $8, then
answer
marginal revenue is equal to $8
question
a firms short-run marginal cost curve will eventually increase because of
answer
diminishing marginal returns
question
assume that in the short run ath the profit maximizing output, the price is lower than average variable cost. the perfectly competitive frim should
answer
shut down
question
assume that a perfectly competitive firm is operating where marginal revenue is greater htna marginal costs. to increase total profits, the firm should
answer
increase production
question
If the average variable cost of producing five units of a product is $100 and the average variable cost of producing six units is $125, then the marginal cost of producing the sixth unit is
answer
$250
question
Which of the following represents the correct relationship between the demand curve for a perfectly competitive industry and the demand curve for a perfectly competitive firm?
answer
PC industry demand is downward slope to the right, PC firm demand is perfectly elastic
question
which of the following is true of a pure monopolists demand curve?
answer
it lies above its marginal revenue curve
question
average fixed cost is shown as the vertical distance between
answer
average variable cost and average total cost
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