ECON 111 Quiz 3 Supply - Assignment Essays

question

A firm's total opportunity cost of production is the sum of the cost of using resources

answer

bought in the market, owned by the firm, and supplied by the firm's owner.

question

Marginal product

answer

is the slope of the total product curve.

question

The difference in the market value of a new car and the market value of the same car one year later is

answer

economic depreciation.

question

Which one of the following statements is not true?

answer

A production process is technologically efficient only if it is producing a given output at the lowest possible cost.

question

The short run is a time frame in which

answer

at least one factor of production is fixed.

question

Refer to Figure 11.2.1 which illustrates Tania's total product curve. Which one of the following statements is false?

answer

The cost of producing at point B equals the cost of producing at point C.

question

Which of the following quotes best illustrates the idea of average product?

answer

"Each worker produces 2 tables a day."

question

The long run refers to a time period

answer

in which all factors of production are variable.

question

When the 7th worker is hired, output increases from 100 units per week to 110 units per week. When the 8th worker is hired, output increases from 110 units to 118 units. This is an example of

answer

diminishing marginal returns.

question

When the marginal product of labour is greater than the average product of labour,

answer

the average product of labour is increasing.

question

Refer to Figure 11.3.2, which illustrates short-run average and marginal cost curves. Which one of the following statements is false?

answer

The vertical gap between curves B and C is equal to average variable cost.

question

Which of the following statements by a restaurant owner refers to the law of diminishing marginal returns?

answer

"We can increase the number of meals we serve by just adding more kitchen staff, but each additional worker adds less meals than the previous worker because traffic in the kitchen will get worse."

question

Marginal cost ________.

answer

decreases at low outputs and increases at high outputs

question

Which of the following are correct? According to the law of diminishing returns,(1) marginal product eventually rises.(2) marginal product eventually falls.(3) marginal cost eventually rises.(4) marginal cost eventually falls.

answer

(2) and (3)

question

If ATC is falling, then MC must be

answer

below ATC.

question

Refer to Figure 11.4.1 which shows the total product curves for four different plant sizes as Tania varies the quantity of capital and workers. The curve that represents the plant using the largest amount of capital is

answer

plant D.

question

Which one of the following statements is false?

answer

Total cost equals fixed cost plus average cost.

question

A production function is the relationship between the maximum output attainable and the

answer

quantities of inputs used.

question

Suppose a candy manufacturer can triple its production of fudge by doubling its production facility for making fudge. This indicates the presence of

answer

economies of scale.

question

The MC curve shifts upward if

answer

factor prices rise.

question

The marginal cost curve slopes downward at low outputs because of ________. The marginal cost curve eventually slopes upward because of ________.

answer

greater specialization and division of labour; the law of diminishing returns

question

Marginal cost equals

answer

ΔTC/ΔQ.

question

Which one of the following is false?

answer

The marginal cost curve intersects the average variable cost curve and the average total cost curve at their maximum points.

question

The marginal cost curve slopes upward due to

answer

diminishing marginal returns.

question

Average variable cost is at a minimum at the same output at which

answer

average product is at a maximum.

question

The long-run average cost curve is the relationship between the lowest attainable average total cost and output, when plant size is ________ and labour is ________. The long-run average cost curve is made up of the segments of individual average ________ cost curves with the lowest average ________ cost for a given output.

answer

varied; varied; total; total

question

Diseconomies of scale are present when

answer

average total cost rises as input increases.

question

The vertical distance between the TC and TVC curves

answer

is equal to TFC.

question

Choose the correct equation.

TFC=TVC-TC

TFC=TC/Q

TFC=TVC/Q

TFC=TC-AVC

answer

TFC=TC-TVC

question

A firm's total product curve describes

answer

the maximum output that a given quantity of labour can produce.

1 of 30

question

A firm's total opportunity cost of production is the sum of the cost of using resources

answer

bought in the market, owned by the firm, and supplied by the firm's owner.

question

Marginal product

answer

is the slope of the total product curve.

question

The difference in the market value of a new car and the market value of the same car one year later is

answer

economic depreciation.

question

Which one of the following statements is not true?

answer

A production process is technologically efficient only if it is producing a given output at the lowest possible cost.

question

The short run is a time frame in which

answer

at least one factor of production is fixed.

question

Refer to Figure 11.2.1 which illustrates Tania's total product curve. Which one of the following statements is false?

answer

The cost of producing at point B equals the cost of producing at point C.

question

Which of the following quotes best illustrates the idea of average product?

answer

"Each worker produces 2 tables a day."

question

The long run refers to a time period

answer

in which all factors of production are variable.

question

When the 7th worker is hired, output increases from 100 units per week to 110 units per week. When the 8th worker is hired, output increases from 110 units to 118 units. This is an example of

answer

diminishing marginal returns.

question

When the marginal product of labour is greater than the average product of labour,

answer

the average product of labour is increasing.

question

Refer to Figure 11.3.2, which illustrates short-run average and marginal cost curves. Which one of the following statements is false?

answer

The vertical gap between curves B and C is equal to average variable cost.

question

Which of the following statements by a restaurant owner refers to the law of diminishing marginal returns?

answer

"We can increase the number of meals we serve by just adding more kitchen staff, but each additional worker adds less meals than the previous worker because traffic in the kitchen will get worse."

question

Marginal cost ________.

answer

decreases at low outputs and increases at high outputs

question

answer

(2) and (3)

question

If ATC is falling, then MC must be

answer

below ATC.

question

answer

plant D.

question

Which one of the following statements is false?

answer

Total cost equals fixed cost plus average cost.

question

A production function is the relationship between the maximum output attainable and the

answer

quantities of inputs used.

question

Suppose a candy manufacturer can triple its production of fudge by doubling its production facility for making fudge. This indicates the presence of

answer

economies of scale.

question

The MC curve shifts upward if

answer

factor prices rise.

question

The marginal cost curve slopes downward at low outputs because of ________. The marginal cost curve eventually slopes upward because of ________.

answer

greater specialization and division of labour; the law of diminishing returns

question

Marginal cost equals

answer

ΔTC/ΔQ.

question

Which one of the following is false?

answer

The marginal cost curve intersects the average variable cost curve and the average total cost curve at their maximum points.

question

The marginal cost curve slopes upward due to

answer

diminishing marginal returns.

question

Average variable cost is at a minimum at the same output at which

answer

average product is at a maximum.

question

answer

varied; varied; total; total

question

Diseconomies of scale are present when

answer

average total cost rises as input increases.

question

The vertical distance between the TC and TVC curves

answer

is equal to TFC.

question

Choose the correct equation.

TFC=TVC-TC

TFC=TC/Q

TFC=TVC/Q

TFC=TC-AVC

answer

TFC=TC-TVC

question

A firm's total product curve describes

answer

the maximum output that a given quantity of labour can produce.

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