Econ 2010 - Assignment Essays

question

Utility is

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Subjective and difficult to measure

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Marginal utility is the

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total satisfaction received from consuming a given number of units of a product

question

As a consumer consumes more and more of a product in a particular time period, eventually marginal utility

answer

Declines

question

If a consumer receives 22 units of marginal utility for consuming the first can of soda 20 units from consuming the second, and 15 from the third, the total utility of consuming the three units is

answer

57 units

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If a consumer receives 20 units of utility from consuming two candy bars, and 25 units of utility from consuming three candy bars, the marginal utility of the third candy bar is

answer

5 units

question

If a consumer receives 20 units of utility from consuming two candy bars, and 25 units of utility from consuming three candy bars, the marginal utility of the second candy bars is

answer

Unknown

question

If, a a person consumer more and more of a good, each additional unit adds less satisfaction than the previous unit consumed, we are seeing the working of

answer

the law of diminishing marginal utility

question

The Law of diminishing Marginal utility stats that

answer

The extra satisfaction from consuming a good decreases as more of a good is consumed, other things constant

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Which of the following is likely to occur as the result of the law of diminishing marginal utility

answer

...

question

Consumer have to make tradeoffs in deciding what to consume because

answer

...

question

If total utility increases at a decreasing rate as a consumer consumes more coffee, than marginal utility must

answer

Decrease

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Suppose your marginal utility from consuming the 3rd slice of cake is zero, than your total utility from consuming cake is

answer

Maximized

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Consumers maximize total utility within their budget constraint by

answer

buying the goods with the largest marginal utility per dollar spent

question

If a consumer always buys goods rationally, then

answer

The marginal utility per dollar spent on all goods will be equal

question

ref tab 3.1 what is keegan optimal consumption bundle

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3 pita wraps 4 bubble

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Carolyn spends her income on popular magazines and music cd's if the price of a CD is four times the price of a magazine if Carolyn is maximizing her utility she buys

answer

...

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Suppose joe is maximizing total utility within his bdget constraint. If the price of the last pair of jeans purchased in 25$ and yields 100 units of extra satisfaction and the price of the last shirt purchased is 20$, Then, using the rule of equal marginal utility per dollar spent, the extra satisfaction received from the last shirt must be

answer

80 units

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Most people would prefer to drive a luxury car that has all options, but more people buy less expensive cars even though they could afford the luxury car because

answer

The marginal utility per dollar spent on the less expensive car is higher than that spent on luxury cars

question

If Callum is consuming his utility maximizing bundle and the price of one good rises, what happens to the marginal utility per dollar spent on this good (MU/P) and what should callum do

answer

MU/P has decreased and callum should buy less of this good

question

If the price of muffins, a normal good you enjoy, rises,

answer

Both the income and substitution effects lead you to buy fewer muffins

question

Ref 3.2 The Bobsey twins, laurel and hardy, both enjoy watching romantic comedies and science fiction movies. Based on the diagrams above what can you conclude about their movie preferences

answer

Laurel enjoys romantic comedies more than Hardy

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If Dawson prefers pizza to hamburgers and hamburger to hot dogs, then if preferences are transitive

answer

She must prefer pizza to hot dogs

question

The slope of an indifference curve

answer

Measures the marginal rate of substitution between the two goods in question

question

A consumer's utility-maximizing combination of goods is given by the bundle that corresponds to the point on

answer

An indifference curve that is tangent to the budget constraint

question

Ref 3.3 the consumer can afford consumption bundles

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s,v and u only

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ref 3.3 suppose the price of pizza increases while the price of hamburgers remains constant. Then, the consumers

answer

Budget constraint move inward toward the origin on the pizza axis while the hamburger intercept remains the same

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ref 3.4 A change in income is shown in

answer

panel B

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ref 3.4 A change in the price of candy only is shown in

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Panel C

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ref 3.4 A change in the price of popcorn only is shown in

answer

Panel A

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By devoting your time and talent to your own business rather than working for someone else, you incur

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Opportunity cost

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The diffence between revenues and explicit costs

answer

Account Profit

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In the long run

answer

there on no fixed inputs

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In the short run

answer

Some inputs are fixed and some inputs are variable

question

The ______ is the increase in output obtained by hiring an addition worker

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Marginal product

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Marginal product is

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Addition output produced when one more unit of the variable input is employed

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The quantity of output divided by the number of workers is the

answer

average product of labor Q/T=APl

question

According to the law of diminishing marginal productivity/returns

answer

the marginal product of a variable input will eventually fall

question

The law of diminishing marginal productivity states that as more units of a variable input are added to a fixed input, the marginal product obtained from one more unit of the variable input

answer

will eventually decrease

question

a production function is the

answer

relationship any combination of inputs and the maximum attainable output from that combination

question

If a firm produces zero output

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total cost equals total fixed Q=0, TC=TFC

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total fixed cost

answer

stays the same no matter how much output is produced

question

Variable costs

answer

exist both in the short and long run

question

the sum of total fixed costs TFC plus total variable cost TVC equals

answer

Total costs

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the cost TC is equal to

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TVC + TFC

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the formula for average variable cost AVC is

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TVC/Q

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Average total cost ATC is

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Total cost divided by output

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Average variable cost equals all of the following except

answer

Total variable cost time output

question

Average fixed cost

answer

falls as output is increased in the short run

question

A firm is producing 100 units of output at a total cost of 400$. The firms average variable cost is 3.50$ per unit. What is the firm total fixed cost

answer

50
400=tvc+tfc tc=tvl+tfc
3.50(100)=3.50=tvc
400=3.50+tfc
50=tfc

question

When output is 50 fixed costs are 1000 and variable costs are 2000 what are average total costs

answer

question

the marginal cost curve is a mirror image of

answer

The marginal product curve

question

If the law of diminishing marginal productivity holds true then eventually both the marginal cost curve and the average cost curve must

answer

reach a minimum and began to increase #23

question

If marginal cost is less than average total cost, then

answer

average total cost is falling

question

If the marginal cost of adding an extra unit of output exceeds average total cost

answer

average total cost must be increasing as output increases

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the marginal cost curve will intersect the average total cost curve when

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the average total cost curve is at its minimum point

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if MC=AVC then

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AVC is at its low point

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Whenever the Marginal cost curve lies above the average cost curve

answer

average total cost is increasing

question

If Gail's grade point average is currently a Band the marginal grad Gail earns is a C then her

answer

GPA will fall

question

Which of the following statements is true

answer

The marginal cost curve intersects the average cost curve and the average variable cost curve at the minimum point of each

question

A perfectly competitive firm's marginal revenue

answer

is constant

question

If the marginal revenue of the last widget the firm produced is $25and its marginal cost $35 a firm should

answer

decrease production

question

the profit maximizing condition of a perfectly competitive firm is

answer

...

question

to maximize profits a perfectly competitive firm should product where

answer

marginal cost equal price

question

A perfectly competitive firm facing a price of 50$ decides to produce 500 widgets. Its marginal cost of producing the last one is 60 if the firms goal is to maximize profit, it should

answer

produce few widgets
P=MR=500
q=500
MC=60
MR=MC

question

suppose a firms marginal revenue is 20 while its marginal cost is 20 under these circumstances the firm

answer

is maximizing profit and should not change output

question

Suppose a perfectly competitive firm can increase its profits by increasing its output then it must be the ease that the firms

answer

Marginal revenue exceeds its marginal cost

question

suppose a perfectly competitive firm is maximizing profit. then is must be true that the firm

answer

Marginal rev is equal to marginal cost

question

as long as price exceeds average variable cost, a perfectly competitive firm's marginal cost curve

answer

is the firms supply curve p>AVC/

question

the supply curve of a perfectly competitive firm is

answer

The segment of the marginal cost curve that lies above the variable cost curve

question

A perfectly competitive firm will earn no economic profit if the ATC curve

answer

is tangent to the MR curve

question

to maximize profits, a perfectly competitive firm should produce where

answer

P=MC

question

Total profit is maximizing where

answer

the vertical distance between the total revenue curve and the total cost curve is greatest, assuming that the total revenue curve lies above the total cost curve

question

If the selling price of a perfectly competitive firm is below the average variable cost, the firm should

answer

Shut down in the short run Refer to e

question

A perfectly competitive firm always makes zero economic profit

answer

In the long run

question

A perfectly competitive firm in the long run earns ____ Normal profits but_____ economic

answer

Positive zero

question

Long-run competitive equilibrium in an industry implies that

answer

there are no positive profits to attract new entrants

question

A firms cost of production is determined by all of the following except

answer

The amount of corporate taxes it must pay on its profit

question

A characteristic of the long run is

answer

All inputs can be varied

question

which of the following is a factor of production that generally is fixed in the short run

answer

a factory building

question

which of the following is an example of a long run adjustment

answer

Walmart builds another supercenter

1 of 80

question

Utility is

answer

Subjective and difficult to measure

question

Marginal utility is the

answer

total satisfaction received from consuming a given number of units of a product

question

As a consumer consumes more and more of a product in a particular time period, eventually marginal utility

answer

Declines

question

If a consumer receives 22 units of marginal utility for consuming the first can of soda 20 units from consuming the second, and 15 from the third, the total utility of consuming the three units is

answer

57 units

question

If a consumer receives 20 units of utility from consuming two candy bars, and 25 units of utility from consuming three candy bars, the marginal utility of the third candy bar is

answer

5 units

question

If a consumer receives 20 units of utility from consuming two candy bars, and 25 units of utility from consuming three candy bars, the marginal utility of the second candy bars is

answer

Unknown

question

If, a a person consumer more and more of a good, each additional unit adds less satisfaction than the previous unit consumed, we are seeing the working of

answer

the law of diminishing marginal utility

question

The Law of diminishing Marginal utility stats that

answer

The extra satisfaction from consuming a good decreases as more of a good is consumed, other things constant

question

Which of the following is likely to occur as the result of the law of diminishing marginal utility

answer

...

question

Consumer have to make tradeoffs in deciding what to consume because

answer

...

question

If total utility increases at a decreasing rate as a consumer consumes more coffee, than marginal utility must

answer

Decrease

question

Suppose your marginal utility from consuming the 3rd slice of cake is zero, than your total utility from consuming cake is

answer

Maximized

question

Consumers maximize total utility within their budget constraint by

answer

buying the goods with the largest marginal utility per dollar spent

question

If a consumer always buys goods rationally, then

answer

The marginal utility per dollar spent on all goods will be equal

question

ref tab 3.1 what is keegan optimal consumption bundle

answer

3 pita wraps 4 bubble

question

Carolyn spends her income on popular magazines and music cd's if the price of a CD is four times the price of a magazine if Carolyn is maximizing her utility she buys

answer

...

question

answer

80 units

question

Most people would prefer to drive a luxury car that has all options, but more people buy less expensive cars even though they could afford the luxury car because

answer

The marginal utility per dollar spent on the less expensive car is higher than that spent on luxury cars

question

If Callum is consuming his utility maximizing bundle and the price of one good rises, what happens to the marginal utility per dollar spent on this good (MU/P) and what should callum do

answer

MU/P has decreased and callum should buy less of this good

question

If the price of muffins, a normal good you enjoy, rises,

answer

Both the income and substitution effects lead you to buy fewer muffins

question

Ref 3.2 The Bobsey twins, laurel and hardy, both enjoy watching romantic comedies and science fiction movies. Based on the diagrams above what can you conclude about their movie preferences

answer

Laurel enjoys romantic comedies more than Hardy

question

If Dawson prefers pizza to hamburgers and hamburger to hot dogs, then if preferences are transitive

answer

She must prefer pizza to hot dogs

question

The slope of an indifference curve

answer

Measures the marginal rate of substitution between the two goods in question

question

A consumer's utility-maximizing combination of goods is given by the bundle that corresponds to the point on

answer

An indifference curve that is tangent to the budget constraint

question

Ref 3.3 the consumer can afford consumption bundles

answer

s,v and u only

question

ref 3.3 suppose the price of pizza increases while the price of hamburgers remains constant. Then, the consumers

answer

Budget constraint move inward toward the origin on the pizza axis while the hamburger intercept remains the same

question

ref 3.4 A change in income is shown in

answer

panel B

question

ref 3.4 A change in the price of candy only is shown in

answer

Panel C

question

ref 3.4 A change in the price of popcorn only is shown in

answer

Panel A

question

By devoting your time and talent to your own business rather than working for someone else, you incur

answer

Opportunity cost

question

The diffence between revenues and explicit costs

answer

Account Profit

question

In the long run

answer

there on no fixed inputs

question

In the short run

answer

Some inputs are fixed and some inputs are variable

question

The ______ is the increase in output obtained by hiring an addition worker

answer

Marginal product

question

Marginal product is

answer

Addition output produced when one more unit of the variable input is employed

question

The quantity of output divided by the number of workers is the

answer

average product of labor Q/T=APl

question

According to the law of diminishing marginal productivity/returns

answer

the marginal product of a variable input will eventually fall

question

The law of diminishing marginal productivity states that as more units of a variable input are added to a fixed input, the marginal product obtained from one more unit of the variable input

answer

will eventually decrease

question

a production function is the

answer

relationship any combination of inputs and the maximum attainable output from that combination

question

If a firm produces zero output

answer

total cost equals total fixed Q=0, TC=TFC

question

total fixed cost

answer

stays the same no matter how much output is produced

question

Variable costs

answer

exist both in the short and long run

question

the sum of total fixed costs TFC plus total variable cost TVC equals

answer

Total costs

question

the cost TC is equal to

answer

TVC + TFC

question

the formula for average variable cost AVC is

answer

TVC/Q

question

Average total cost ATC is

answer

Total cost divided by output

question

Average variable cost equals all of the following except

answer

Total variable cost time output

question

Average fixed cost

answer

falls as output is increased in the short run

question

A firm is producing 100 units of output at a total cost of 400$. The firms average variable cost is 3.50$ per unit. What is the firm total fixed cost

answer

50
400=tvc+tfc tc=tvl+tfc
3.50(100)=3.50=tvc
400=3.50+tfc
50=tfc

question

When output is 50 fixed costs are 1000 and variable costs are 2000 what are average total costs

answer

question

the marginal cost curve is a mirror image of

answer

The marginal product curve

question

If the law of diminishing marginal productivity holds true then eventually both the marginal cost curve and the average cost curve must

answer

reach a minimum and began to increase #23

question

If marginal cost is less than average total cost, then

answer

average total cost is falling

question

If the marginal cost of adding an extra unit of output exceeds average total cost

answer

average total cost must be increasing as output increases

question

the marginal cost curve will intersect the average total cost curve when

answer

the average total cost curve is at its minimum point

question

if MC=AVC then

answer

AVC is at its low point

question

Whenever the Marginal cost curve lies above the average cost curve

answer

average total cost is increasing

question

If Gail's grade point average is currently a Band the marginal grad Gail earns is a C then her

answer

GPA will fall

question

Which of the following statements is true

answer

The marginal cost curve intersects the average cost curve and the average variable cost curve at the minimum point of each

question

A perfectly competitive firm's marginal revenue

answer

is constant

question

If the marginal revenue of the last widget the firm produced is $25and its marginal cost $35 a firm should

answer

decrease production

question

the profit maximizing condition of a perfectly competitive firm is

answer

...

question

to maximize profits a perfectly competitive firm should product where

answer

marginal cost equal price

question

A perfectly competitive firm facing a price of 50$ decides to produce 500 widgets. Its marginal cost of producing the last one is 60 if the firms goal is to maximize profit, it should

answer

produce few widgets
P=MR=500
q=500
MC=60
MR=MC

question

suppose a firms marginal revenue is 20 while its marginal cost is 20 under these circumstances the firm

answer

is maximizing profit and should not change output

question

Suppose a perfectly competitive firm can increase its profits by increasing its output then it must be the ease that the firms

answer

Marginal revenue exceeds its marginal cost

question

suppose a perfectly competitive firm is maximizing profit. then is must be true that the firm

answer

Marginal rev is equal to marginal cost

question

as long as price exceeds average variable cost, a perfectly competitive firm's marginal cost curve

answer

is the firms supply curve p>AVC/

question

the supply curve of a perfectly competitive firm is

answer

The segment of the marginal cost curve that lies above the variable cost curve

question

A perfectly competitive firm will earn no economic profit if the ATC curve

answer

is tangent to the MR curve

question

to maximize profits, a perfectly competitive firm should produce where

answer

P=MC

question

Total profit is maximizing where

answer

the vertical distance between the total revenue curve and the total cost curve is greatest, assuming that the total revenue curve lies above the total cost curve

question

If the selling price of a perfectly competitive firm is below the average variable cost, the firm should

answer

Shut down in the short run Refer to e

question

A perfectly competitive firm always makes zero economic profit

answer

In the long run

question

A perfectly competitive firm in the long run earns ____ Normal profits but_____ economic

answer

Positive zero

question

Long-run competitive equilibrium in an industry implies that

answer

there are no positive profits to attract new entrants

question

A firms cost of production is determined by all of the following except

answer

The amount of corporate taxes it must pay on its profit

question

A characteristic of the long run is

answer

All inputs can be varied

question

which of the following is a factor of production that generally is fixed in the short run

answer

a factory building

question

which of the following is an example of a long run adjustment

answer

Walmart builds another supercenter

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