Ch.9 Mircoeconomics - Assignment Essays

question

The law of diminishing returns indicates that

answer

as extra units of a variable resource are added to a fixed resource, marginal product will decline beyond some point

question

The following is cost information for the creamy crisp donut company

Entrepreneur's potential earnings as a salaried worker = $50,000
Annual lease of building = $22,000
Annual revenue from operations = $380,000
Payments to workers = $120,000
Utilities (electricity, water, disposal) costs = $8,000
Value of entrepreneur's talent in the next best entrepreneurial activity =$80,000
Entrepreneur's forgone interest on personal funds used to finance the business = $6,000

Creamy crisps accounting profit is

answer

$230,000

question

Which of the following statements is true concerning the relationships between total product (TP), average product(AP) and marginal product(MP) is not correct?

answer

AP continues to rise so long as TP is rising

question

Accounting profits equal total revenue minus

answer

total explicit costs

question

which of the following definitions is correct?

answer

Economic profit = accounting profit - implicit costs.

question

The amount of calendar time associated with the long run

answer

varies from industry to industry

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implicit and explicit costs are different in that

answer

the former refer to non-expenditure costs and the latter to monetary payments.

question

Accounting profits are typically

answer

greater than economic profits because the former do not take implicit costs into account.

question

Which of the following is correct

answer

Marginal product rises faster than average product and also falls faster than average product

question

Suppose that a business incurred implicit costs of $500,000 and explicit costs of $5million in a specific year. If the firm sold 100,000 units of its output at $50 per unit, its

answer

accounting profits were $0 and its economic losses were $500,000

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The basic characteristic of the short run is that

answer

the fir does not have sufficient time to change the size of its plant

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normal profit is

answer

the return to the entrepreneur when economic profits are zero.

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Which of the following is most likely to be an implicit cost for company X

answer

forgone rent from the building owned and used by Company X

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Which of the following is most likely to be a variable cost

answer

fuel and power payments

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Which of the following is most likely to be a fixed cost?

answer

Property insurance premiums

question

Assume that in the short run a firm is producing 100 units of output, has average total costs of $200, and has average variable costs of $150. The forms total fixed costs are

answer

$5,000

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The following information for the creamy crisp donut company.

Entrepreneur's potential earnings as a salaried worker

answer

...

question

Answer the question on the basis of the accompanying table that shows average total costs (ATC) for a manufacturing firm whose total fixed costs are $10.

The marginal cost of the fourth unit of output is
-$ 12
-$16
-$37
-$2

answer

-$37

question

Answer the question on the basis of the following cost data

The avergae fixed cost of producing 3 units of output is

$7.40
$5.50
$8.00
$6.00

answer

$8.00

question

Refer to the diagram. At output level Q total fixed cost is:

OCDQ
OBEQ
OBEQ-OAFQ
BCDE

answer

- BCDE

question

Answer the question on the basis of the following cost data

The marginal cost of producing the sixth unit of output is

$24
$8
$12
$16

answer

question

In the diagram, curves 1, 2 and 3 represent the

answer

Marginal, average and total product curves respectively

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In the figure, curves 1,2,3 and 4 represent the

answer

MC, ATC, AVC, and AFC curves respectively.

1 of 23

question

The law of diminishing returns indicates that

answer

as extra units of a variable resource are added to a fixed resource, marginal product will decline beyond some point

question

answer

$230,000

question

Which of the following statements is true concerning the relationships between total product (TP), average product(AP) and marginal product(MP) is not correct?

answer

AP continues to rise so long as TP is rising

question

Accounting profits equal total revenue minus

answer

total explicit costs

question

which of the following definitions is correct?

answer

Economic profit = accounting profit - implicit costs.

question

The amount of calendar time associated with the long run

answer

varies from industry to industry

question

implicit and explicit costs are different in that

answer

the former refer to non-expenditure costs and the latter to monetary payments.

question

Accounting profits are typically

answer

greater than economic profits because the former do not take implicit costs into account.

question

Which of the following is correct

answer

Marginal product rises faster than average product and also falls faster than average product

question

Suppose that a business incurred implicit costs of $500,000 and explicit costs of $5million in a specific year. If the firm sold 100,000 units of its output at $50 per unit, its

answer

accounting profits were $0 and its economic losses were $500,000

question

The basic characteristic of the short run is that

answer

the fir does not have sufficient time to change the size of its plant

question

normal profit is

answer

the return to the entrepreneur when economic profits are zero.

question

Which of the following is most likely to be an implicit cost for company X

answer

forgone rent from the building owned and used by Company X

question

Which of the following is most likely to be a variable cost

answer

fuel and power payments

question

Which of the following is most likely to be a fixed cost?

answer

Property insurance premiums

question

Assume that in the short run a firm is producing 100 units of output, has average total costs of $200, and has average variable costs of $150. The forms total fixed costs are

answer

$5,000

question

The following information for the creamy crisp donut company.

Entrepreneur's potential earnings as a salaried worker

answer

...

question

answer

-$37

question

Answer the question on the basis of the following cost data

The avergae fixed cost of producing 3 units of output is

$7.40
$5.50
$8.00
$6.00

answer

$8.00

question

Refer to the diagram. At output level Q total fixed cost is:

OCDQ
OBEQ
OBEQ-OAFQ
BCDE

answer

- BCDE

question

Answer the question on the basis of the following cost data

The marginal cost of producing the sixth unit of output is

$24
$8
$12
$16

answer

question

In the diagram, curves 1, 2 and 3 represent the

answer

Marginal, average and total product curves respectively

question

In the figure, curves 1,2,3 and 4 represent the

answer

MC, ATC, AVC, and AFC curves respectively.

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