CHAPTER 1 QUIZ

suppose total benefits and total costs are given by B(Q)=100Y- 8Y^2 and C(Y)= 10Y^2. Then marginal benefits are: A. 100-16Y B. 100Y-8Y^2 C. 50-4Y D. 200Y-10Y

A. 100-16Y

Suppose total benefits and total costs are given by B(Y) = 600Y − 12Y2 and C(Y) = 20Y2. What level of Y will yield the maximum net benefits? A. 600/64 B. 600/32 C. 300/64 D. 300/32

A. 600/64

Suppose total benefits and total costs are given by B(Y) = 100Y − 8Y2 and C(Y) = 10Y2. What is the maximum level of net benefits (rounded to the nearest whole number)? A. 92 B. 139 C. 78 D. None of the statements associated with this question are correct.

B. 139

Managerial economics: A. has little to say about day-to-day decisions. B. is valuable to the coordinator of a shelter for the homeless. C. is not relevant for managers of not-for-profit groups. D. is the study of how to get rich in the stock market.

B. is valuable to the coordinator of a shelter for the homeless.

*Table Question* To maximize net benefits in the table, it is most appropriate to use: A. four units of the control variable, since the marginal benefit exceeds marginal cost. B. six units of the control variable, since the marginal cost exceeds marginal benefit. C. five units of the control variable, since net marginal benefits are zero. D. None of the statements associated with this question are correct.

C. five units of the control variable, since net marginal benefits are zero.

Suppose total benefits and total costs are given by B(Y) = 100Y − 8Y2 and C(Y) = 10Y2. What level of Y will yield the maximum net benefits? A. 75/36 B. 75/18 C. 50/18 D. 100/36

D. 100/36

Which of the following is (are) true? A. Accounting costs generally understate economic costs. B. Accounting profits generally overstate economic profits. C. In the absence of any opportunity costs, accounting profits equal economic profits. D. All of the statements associated with this question are correct.

D. All of the statements associated with this question are correct.