question
In the __________, the perfectly competitive firm will react to profits by ___________
answer
long run; increasing its production
question
If a graph is used to compare total revenue and total cost of a perfectly competitive firm, then the horizontal axis of the graph will represent the__________ and the vertical axis will represent ______________.
answer
quantity produced; both total revenue and total costs, measured in dollars.
question
An _____________ is calculated by subtracting the firm's costs from its total revenues,
Selected:
Selected:
answer
accounting profit; excluding opportunity cost
question
Temperatures have persisted below freezing levels in Florida throughout the months of December and January. As a result, demand for electricity sharply increased and the price of electricity rose sharply. The price of coal also rose. In these circumstances, any resulting shifts in the supply curves for coal miners and electricity producers
answer
can also be interpreted as shifts of their respective marginal cost curves
question
In a free market economy, firms operating in a perfectly competitive industry are said to have only one major choice to make. Which of the following correctly sets out that choice?
answer
what quantity to produce
question
Which of the following can be thought of as an adjustment for the risks involved with respect to the cost of a firm acquiring financial capital?
answer
imposition of hurdle rates of interest
question
In the __________ , the perfectly competitive firm will seek out ____________.
answer
short run; the quantity of output where profits are highest
question
in the __________, if profits are not possible, the perfectly competitive firm will seek out the quantity of output where __________.
answer
short run; losses are smallest
question
It is said that in a perfectly competitive market, raising the price of a firm's product from the prevailing market price of $179.00 to $199.00, .
answer
could likely result in a notable loss of sales to competitors
question
For a perfectly competitive firm, the marginal cost curve is identical to the firm's....
answer
supply curve
question
If the quality differences of similar products are mostly imperceptible to the average consumer's eyes, which of the following will most likely play a major role in influencing the decisions of purchasers?
answer
price of competing products
question
In the ___________, the perfectly competitive firm will react to losses by _____________.
answer
long run; reducing production or shutting down
question
I'maGoldMiner has benefited from a record rise in gold prices in the global commodities market. While the price of its output is highly influenced by market speculation, if it wants to increase production to take advantage of the current profit-maximizing opportunity, the company
answer
must accept market price for its physical capital inputs.
question
If a firm's revenues do not cover its average variable costs, then that firm has reached its
answer
shutdown point
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
____________ occur when the marginal gain in output diminishes as each additional unit of input is added.
answer
Diminishing marginal returns
question
If a paper mill shuts down its operations for three months so that it produces nothing, its __________________ will be reduced to zero?
answer
variable costs
question
I'MaGadgetCo. produces and sells widgets. Last year, it produced 9,000 widgets and sold each one for $8. To produce the 9,000 widgets, the company incurred variable costs of $27,000 and a total cost of $36,000. I'MaGadgetCo's average fixed cost to produce 9,000 widgets was
answer
$1.00
question
The _____________________ curve will always lie below the curve for average cost because average cost includes _____________ in the numerator of the calculation.
answer
average variable cost; fixed costs
question
The term _____________ is used to describe the additional cost of producing one more unit.
answer
Marginal Cost
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
The term __________________ describes a situation where the quantity of output rises, but the average cost of production falls
answer
economies of scale
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.
question
If a firm is experiencing _____________________, then as the quantity of output rises, the average cost of production rises.
answer
decreasing returns to scale
question
Why would labor be treated as a variable cost?
answer
producing larger quantities of a good or service generally requires more workers
question
I'MABigCorp. produces and sells kitchen wares. Last year, it produced 7,000 can openers and sold each one for $6. To produce the 7,000 can openers, the company incurred variable costs of $28,000 and a total cost of $45,000. I'MABIGCorp.'s average fixed cost to produce the 7,000 can openers was
answer
$2.43
question
__________ tells a firm whether it can earn profits given the price in the market.
answer
Average cost
question
The economies-of-scale curve is a long-run average cost curve, because
answer
it allows all factors of production to change.
question
In economics, a firm that faces no competitors is referred to as _________________.
answer
monopoly
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
