Production - SmartBook

_ of scale is a condition in which the long-run average total cost of production decreases as production increases.

Economies

_ of scale is a condition in which the long-run average total cost of production increases as production increases.

Diseconomies

_ marginal returns is a characteristic of production whereby the marginal product of the next unit of a variable resource utilized is greater than that of the previous variable resource.

Increasing

The long run is:

a period of time in which all inputs of production are variable

Marginal product is the:

additional output produced as a result of utilizing one more unit of a variable resource.

The amount of output produced per unit of a resource employed is the _ product.

average

Total product divided by the number of units of a resource employed gives the _ product of the resource.

average

The fixed cost per unit is equal to:

average fixed cost.

Total variable cost divided by the amount of output produced is equal to:

average variable cost.

Variable cost per unit of output produced is:

average variable cost.

Total revenue minus the explicit and implicit costs of production is _____ profit.

economic

The costs associated with the use of resources are called:

economic costs.

A condition in which the long-run average total cost of production decreases as production increases is called:

economies of scale.

The marginal cost is the:

extra or additional cost associated with the production of an additional unit of output.

Increasing marginal returns is a characteristic of production whereby the marginal product of the next unit of a variable resource utilized is _ (greater/smaller) than that of the previous variable resource.

greater

Economic costs can be defined as the sum of _____ and _____ costs.

implicit; explicit

Total revenue minus the total _____ and total _____ costs of production is economic profit.

implicit; explicit

Diseconomies of scale is a condition in which the long-run average total cost of production _ as production increases.

increases or rises

A period of time in which at least one _ of production is fixed is known as the short run.

input or factor

Economies of scale is a condition in which the _-run average total cost of production decreases as production increases.

long

Constant returns to scale occur when:

long-run average total cost does not change as output increases.

The extra or additional cost associated with the production of an additional unit of output is the _ cost.

marginal

The extra or additional cost associated with the production of an additional unit of output is the:

marginal cost.

Costs that do not change with the amount of _____ produced are fixed costs.

output Reason: Costs that do not change with the amount of output produced are fixed costs.

Costs that do not change with the amount of _ produced are fixed costs.

output or product

A period of time in which at least one input of production is fixed is known as the _ (short/long) run.

short

Total product is:

the total amount of output produced with a given amount of resources.

The total amount of output produced with a given amount of resources is known as:

total product.

Costs that change with the amount of output produced are _ costs.

variable

Costs that change with the amount of output produced are _____ costs.

variable

Costs that increase as production increases and decrease as production decreases are _ costs.

variable or total

The additional output produced as a result of utilizing one more unit of a variable resource is called:

marginal product.

Suppose a snowboard manufacturer increases its output by 1 snowboard per day. As a result, the total cost of producing snowboards each day rises from $100 to $110. The marginal cost of producing an extra snowboard is $_.

10 or 10.0

Suppose a snowboard manufacturer increases it output by 1 snowboard per day. As a result, the total cost of producing snowboards each day rises from $120 to $145. The marginal cost of producing an extra snowboard is $_.

25 or 25.0

Total fixed cost divided by the amount of output produced is equal to:

average fixed cost.

Total cost divided by the amount of output produced is equal to:

average total cost.

Total cost per unit is equal to:

average total cost.

A condition in which the long-run average total cost of production remains constant as production increases is called:

constant returns to scale.

A period of time in which all inputs of production are variable is the _ run.

long