Eco 7

The ___________________ of all firms can be broken down into some common underlying patterns.

Cost structure

______________________ help to explain why every economy, as it develops, has an increasing proportion of its population living in urban areas.

agglomeration factor

The _________________ curve will always lie below the curve for average cost because average cost includes ______________ in the numerator of the calculation.

average variable cost, fixed

A situation known as _______________ occurs when all production inputs are allowed to expand, but that expansion does not result in much of a change in the average cost of production.

constant returns of scale

Which of the following falls outside of the classification of business expenditures that fall int the category of variable costs?

cost of research and development

When ______________ exist, doubling of all inputs will result in more than doubling output, which means _________________.

economics of scales, a factory can at a lower average cost than a smaller company

In order to calculate marginal cost, the change in _________________ is divided by the amount of change in quantity.

either total cost or variable cost

Marcella operates a small, but very successful art gallery. All but one of the following can be classified as a variable cost arising from the physical inputs Marcella requires to operate her business. Which is it?

physical space for the gallery

Fixed costs are important because, at least in the _______________, the firm ________________.

short run, cannot alterthem

Whatever the firm's quantity of production, _________ must exceed total costs if it is to earn a profit.

total revenue