question
____________________________ occur when the marginal gain in output diminishes as each additional unit of input is added.
answer
Diminishing marginal returns
question
Refer to the table below. If the firm produces 5 units that it sells for $39.00 each, what will its profits or losses equal?
answer
profits equal $40
question
Approximately what percentage of the US labor force is employed by firms that have fewer than 100 employees?
answer
35%
question
Mindy's company manufactures rubber balls used by elementary schools for playground activities. The table below sets out her firm's production cost information. Some values are missing. Which of the following statements is correct?
answer
A = 20; E = 45 (wrong)
question
In order to calculate marginal cost, the change in ______________ is divided by the amount of change in quantity.
answer
either total cost or variable cost
question
Which of the following should typically be ignored because spending has already been made and cannot be changed?
answer
sunk costs
question
Refer to the table below. If this information were used to create a total cost graph, the curve should
answer
reflect all of the above.
question
If a solar panel manufacturer wants to look at its total costs of production in the short run, which of the following would provide a useful starting point?
answer
divide total costs into two categories: fixed costs that can't be changed in the short run and variable costs that can be
question
Refer to the table below. If the firm produces 5 units that it sells at a price of $30.00 each, what will its profits or losses equal?
answer
losses equal $5
question
Which of the following falls outside of the classification of business expenditures that fall into the category of variable costs?
answer
costs of research and development
question
Whatever the firm's quantity of production, _____________ must exceed total costs if it is to earn a profit.
answer
total revenue
question
The ______________ of all firms can be broken down into some common underlying patterns.
answer
cost structure
question
The graph below illustrates the total cost function for GoodieCookie Co. The changing slope of the total cost curve reflects this company's
answer
decreasing marginal costs.
question
In microeconomics, the term _____________________ is synonymous with economies of scale.
answer
increasing returns to scale
question
The future of cities in the United States and in other countries will be determined by their ability to benefit from the _________________ and to minimize or counterbalance the ______________________.
answer
economies of agglomeration; corresponding diseconomies
question
I'MaPizzaCo. produces and sells specialty pizzas. Last year, it produced 8,000 mushroom, sausage and spinach pizzas and sold each one for $8. To produce these 8,000 specialty pizzas, the company incurred variable costs of $24,000 and a total cost of $40,000. I'MaPizzaCo's average fixed cost to produce 8,000 specialty pizzas was
answer
$2.00
question
Which of the following falls outside of the classification of business expenses that fall into the category of fixed costs?
answer
costs incurred in the act of producing
question
When __________________ exist, doubling of all inputs will result in more than doubling output, which means __________________________________________.
answer
economies of scale; a larger factory can produce at a lower average cost than a smaller company.
question
____________ tells a firm whether it can earn profits given the price in the market.
answer
Average cost
question
Economies of scale may arise from all but one of the following. Which one is it?
answer
government economic subsidies protect firms from competition to avoid losses.
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