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Exam 13: The Costs of Production

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Question 161

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Total revenue minus both explicit and implicit costs is called

A) accounting profit.
B) economic profit.
C) average total cost.
D) total cost.

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Question 162

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Table 13-19 -Refer to Table 13-19. What is the marginal product of the second worker?

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250 - 100 ...

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Question 163

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If the marginal cost of producing the tenth unit of output is $2.50, and if the average total cost of producing the tenth unit of output is $3, then at ten units of output, average total cost is rising.

The economic field of industrial organization examines how firms' decisions about prices and quantities depend on the market conditions they face.

Figure 13-5 -Refer to Figure 13-5. Which curve is most likely to represent average total cost?

In the long run a company that produces and sells candy bars incurs total costs of $1,200 when output is 2,400 candy bars and $1,400 when output is 2,900 candy bars. The candy bar company exhibits

Scenario 13-19 Doreen's Dairy produces and sells Swiss cheese. Last year, it produced 7,000 pounds and sold each pound for $6. In producing the 7,000 pounds, the dairy incurred variable costs of $28,000 and a total cost of $40,000. -Refer to Scenario 13-19. The firm's fixed cost was

Economies of scale occur when

Figure 13-9 The figure below depicts average total cost functions for a firm that produces automobiles. -Refer to Figure 13-9. This firm experiences diseconomies of scale at what output levels?

Patrice owns a travel agency. Her accountant most likely includes which of the following costs on her financial statements?

Figure 13-5 -Refer to Figure 13-5. Curve A is always declining because

Marginal cost is equal to average total cost when

Table 13-7 The Flying Elvis Copter Rides -Refer to Table 13-7. What is the value of R?

Table 13-12 Eileen's Elegant Earrings produces pairs of earrings for its mail order catalogue business. Each pair is shipped in a separate box. She rents a small room for $150 a week in the downtown business district that serves as her factory. She can hire workers for $275 a week. There are no implicit costs. -Refer to Table 13-12. During the week of July 4th, Eileen doesn't produce any earrings. What are her costs during the week?

Suppose that a firm's long-run average total costs of producing custom wooden picnic tables is $300 when it produces 10,000 tables and $325 when it produces 11,000 tables. For this range of output, the firm is experiencing

Which of the following expressions is correct?

For a firm, the relationship between the quantity of inputs and quantity of output is called the

Scenario 13-15 Joan grows pumpkins. If Joan plants no seeds on her farm, she gets no harvest. If she plants 1 bag of seeds, she gets 500 pumpkins. If she plants 2 bags, she gets 800 pumpkins. If she plants 3 bags, she gets 900 pumpkins. A bag of seeds costs $100, and seeds are her only cost. -Refer to Scenario 13-15. Joan's production function exhibits

Table 13-18 -Refer to Table 13-18. What is the marginal product of the third worker?

Figure 13-5 -Refer to Figure 13-5. Curve D intersects curve C