ECON QUIZ CH9-13

Refer to Table 13-7. What is the value of B?

$100

Refer to Table 13-7. What is the value of C?

$100

Refer to Table 13-7. What is the value of E?

$100

Katherine gives piano lessons for $15 per hour. She also grows flowers, which she arranges and sells at the local farmer's market. One day she spends 5 hours planting $50 worth of seeds in her garden. Once the seeds have grown into flowers, she can sell them for $150 at the farmer's market. Katherine's accounting profits are

$100, and her economic profits are $25.

Refer to Table 13-7. What is the value of F?

$150

The Three Amigo's company produced and sold 500 dog beds. The average cost of production per dog bed was $50. Each dog bed can be sold for a price of $65. The Three Amigo's total costs are

$25,000.

Marcus sells 300 candy bars at $0.50 each. His total costs are $125. His profits are

$25.

Refer to Table 13-7. What is the value of A?

$50

Refer to Table 13-7. What is the value of D?

$50

Carol Anne makes candles. If she charges $20 for each candle, her total revenue will be

$500 if she sells 25 candles.

Scenario 13-3 Ziva is an organic lettuce farmer, but she also spends part of her day as a professional organizing consultant. As a consultant, Ziva helps people organize their houses. Due to the popularity of her home-organization services, Farmer Ziva has more clients requesting her services than she has time to help if she maintains her farming business. Farmer Ziva charges $25 an hour for her home-organization services. One spring day, Ziva spends 10 hours in her fields planting $130 worth of seeds on her farm. She expects that the seeds she planted will yield $300 worth of lettuce. Refer to Scenario 13-3. Ziva's economic profit from farming equals

*****$130.

Refer to Figure 13-5. Which of the following statements is correct?

Average variable cost is declining for quantities less than B because marginal cost is lower than average variable cost.

For a large firm that produces and sells automobiles, which of the following costs would be a variable cost?

The cost of the steel that is used in producing automobiles

On a 100-acre farm, a farmer is able to produce 3,000 bushels of wheat when he hires 2 workers. He is able to produce 4,400 bushels of wheat when he hires 3 workers. Which of the following possibilities is consistent with the property of diminishing marginal product?

The farmer is able to produce 5,600 bushels of wheat when he hires 4 workers.

If a firm produces nothing, it still incurs its fixed costs.

True

Implicit costs are costs that do not require an outlay of money by the firm.

True

Firms may experience diseconomies of scale when

large management structures are bureaucratic and inefficient.

When a firm experiences constant returns to scale,

long-run average total cost is unchanged, even when output increases.

If marginal cost is rising,

marginal product must be falling.

Total revenue equals

price × quantity.