micro Ch 6: Sellers and Incentives

The short run is a period of time where __________ while the long run is a period of time where __________.

at least one input is fixed, all inputs are variable

If the number of people in a publishing company does not go up or down with the quantity of books it publishes, then how should we categorize the salaries and benefits paid to these employees?

As a part of fixed cost

In the short-run, the cost that is independent of the amount of output produced is called __________.

Fixed cost

What is the name for the additional output that a firm produces as a result of hiring one more worker?

Marginal product of labor

In perfect competition, the marginal revenue is the same as:

Price

Which of these costs are affected by the level of output produced?

Variable costs

The downward sloping part of the long run average total cost curve is where the firm is achieving:

economies of scale

If the price elasticity of supply is 0.4, then a 20% increase in price will __________ the quantity supplied by __________ %.

increase, 8.0

The relationship between the inputs used by the firm and the maximum output it can produce is known as the:

production function

If prices rise the quantity supplied will be greater:

the longer the time that elapses

What term do economists use to refer to the minimum amount that investors must earn on the funds they invest in a firm, expressed as a percentage of the amount invested?

Normal rate of return

Accounting profits will always be __________ economic profit.

larger than

The price elasticity of supply always has a:

positive value