Chapter 5 test answers

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IS,US,ES

Because it takes huge amounts of capital and technology to increase nuclear power output, the supply curve for nuclear power is A. inelastic in the short run. B. elastic in the short run. C. inelastic in the long run. D. unit elastic in the long run.

a

Which of these best describes the influence of high prices on the behavior of producers? A. They are an incentive for producers to produce more. B. They are an incentive for producers to buy less. C. They encourage producers to modify their supply schedules. D. They have no significant overall effect on producer behavior.

a

Which of these is an example of a variable cost? A. raw materials B. interest fees on bonds C. state and local property taxes D. payments on leased properties

a

Which terms describe costs that are incurred regardless of a firm's rate of production? A. fixed costs and overhead B. fixed costs and total costs C. variable costs and overhead D. variable costs and total costs

a

supply schedule

a chart showing the quantities offered f s a e p

Based on the chart, which of the following statements are accurate? Select all that apply. A. The goal of profitability is the break-even point, at which production generates enough revenue to cover a company's total operating costs. B. Although Stage II is the stage of diminishing returns, it also includes the point at which there is profit-maximizing quantity of output. C. Marginal cost, the extra cost incurred when producing one more unit of output, is calculated by dividing the additional cost of adding each worker by the marginal revenue. D. The two most important columns show marginal cost and total revenue because they are the most useful measures of cost and revenue, respectively. E. Marginal revenue, the extra revenue a business receives from the production and sale of one additional unit of output, is calculated by dividing the change in total revenue by the change in total output. F. Total fixed costs, sometimes called overhead, remain the same. Your Score 1 / 1 points

b,e,f

When is a firm's rate of hiring likely to be highest? A. during a phase of negative marginal returns B. during a phase of uncertain marginal returns C. during a phase of increasing marginal returns D. during a phase of decreasing marginal returns

c

Which of these can be added to determine total costs? A. fixed costs and overhead B. marginal costs and overhead C. fixed costs and variable costs D. fixed costs and marginal costs

c

Which of these describes an item for which a change in its supply is proportional to a change in its price? A. elastic B. inelastic C. unit elastic D. demand elastic

c

Which of these is an example of a fixed cost? A. labor B. delivery charges for output C. depreciation of capital goods D. charges for a factory's electrical use

c

total product

entirely of output or

Which term denotes the change in total income when one additional unit of output is added?

marginal revenue

average revenue

mean

Law of Supply

principle that more will be offered for sale at hi

most likely total revenue

produce less of that item

quantity supplied

the amount offered for sale at a g p p

At which point in the stages of production does the maximum profitable number of workers become most apparent?

the beginning of stage 3

supply

the different amounts offered for sale at each possible

Which of these industries has the least elastic supply curve?

the nuclear industry

Based on the chart and graph, which of the following statements about short-run production are accurate? Select all that apply. A. Adding workers increases total product in Stage I. B. Adding workers decreases total product in Stage II. C. Adding workers decreases total product in Stage III. D. Adding workers increases total product in Stage II. E. Adding workers can increase or decrease total product in Stage I.

a,c,d

A supply schedule lists various quantities of a specific product with A. possible production expenses. B. possible prices in the market. C. possible changes in demand. D. possible fixed costs.

b

Over which of these does a producer have the most direct control? A. fixed cost B. variable cost C. average revenue D. marginal revenue

b

marginal cost

extra expense one additional

Which term is generally associated with machines and other capital goods?

fixed cost

subsidy

government payment

production function

graph showing how a change single variable total output

Which of these best describes the influence of high prices on the behavior of producers?

high prices are an incentive for producers to produce more

Which of these best enables a firm to establish its profit-maximizing quantity of output?

a periodic marginal analysis

Which of these do producers of an item hope to achieve when adopting new technologies?

a shift of the supply curve for that item to the right

Based on the graphs, which of the following statements about individual and market supply curves are accurate? Select all that apply. A. If the price of goods for Firm A remains steady and the price of goods for Firm B rises, the market supply curve will rise. B. If the price of goods for Firm A remains steady and the price of goods for Firm B rises, the market supply curve will remain steady. C. If the price of goods for Firm A drops and the price of goods for Firm B remains steady, the market supply curve will drop. D. If the price of goods for Firm A drops and the price of goods for Firm B remains steady, the market supply curve will remain steady. E. If the price of goods for Firm A rises and the price of goods for Firm B drops, the market supply curve will remain steady. Your Score 0 / 1 points

a,c

The level of production that generates just enough revenue to cover its total operating costs is called the: A. overhead. B. break-even point. C. profit-maximizing quantity of output. D. marginal production.

b

Which of these could a firm accomplish during a short-run production period? A. relocation of factories B. hiring and firing of workers C. purchase and development of land D. development of new manufacturing technology

b

Which of these measures determines the three stages of production? A. total product B. supply schedule C. change in supply D. marginal product

d

Ecommerce

internet

At which stage of production does the concept of "diminishing returns" first become significant?

stage 2

Which of these is the best description of a normal supply curve? A. Its slope is completely horizontal. B. Its slope goes up when the diagram is read from right to left. C. Its slope goes up when the diagram is read from left to right. D. Its slope is mostly horizontal, with occasional vertical fluctuations.

c

Which stage of production is distinguished by negative marginal returns? A. Stage I B. Stage II C. Stage III D. Negative marginal returns are a dynamic of the entire production process.

c

Which term is generally associated with labor and raw materials? A. total cost B. fixed cost C. variable cost D. marginal cost

c

Labor in a factory is an example of which of these? A. a marginal product B. a diminishing return C. a fixed factor of production D. a variable factor of production

d

Which of these describes an effect of increased government regulation on producers? A. It shifts their market supply curve to the right. B. It shifts their market supply curve to the left. C. It prompts them to increase output at all possible prices. D. It encourages production by requiring the use of new technology.

b

Which of these names the way in which producers regard taxes? A. as an investment in technology B. as part of the cost of production C. as an entry in their supply schedule D. as an encouragement to productivity

b

Which stage(s) of production are distinguished by increases in output? A. Stage I B. Stages I and II C. Stages II and III D. Stages I, II, and II

b

Why might a producer's introduction of a new technology result in a brief shift of a product's supply curve to the left? A. That technology may reduce production costs. B. There may be a period of adjustment to that technology. C. There may be an increase in output despite the same amount of input. D. That technology may increase production more rapidly than expected.

b

Factors that can cause a change in supply include A. technology and government regulations. B. increases in the number of sellers and market expectations. C. increased or decreased government subsidies. D. all of the above

d