Microeconomics Chapter 13

Zach's economic profit for the year was

$-406000

Refer to Table 13-5. What is the variable cost of producing zero widgets?

$0.00

Refer to Table 13-5. What is the marginal cost of producing the first widget?

$1.00

Refer to Table 13-5. The average total cost of producing one widget is

$11.00

If Joe purchases the factory with his own money, what is the annual implicit opportunity cost of purchasing the factory?

$12000

Refer to Table 13-8. What is the average variable cost of producing 3 gigaplots at Jimmy's Gigaplot factory?

$15

Refer to Table 13-8. What is the marginal cost of the 2nd gigaplot at Jimmy's Gigaplot factory?

$15

Refer to Table 13-5. What is the variable cost of producing five widgets?

$15.00

Suppose Joe Purchases the factory using $200000 of his own money and $200000 of his own money borrowed from the bank at an interest rate of 6 percent. What is joe's annual opportunity cost of purchasing the factory?

$18000

Refer to Table 13-8. What is the marginal cost of the 4th gigaplot at Jimmy's Gigaplot factory?

$19

Refer to Table 13-5. The average fixed cost of producing five widgets is

$2.00

Refer to Table 13-5. The average variable cost of producing four widgets is

$2.50

Refer to Table 13-8. What is the average total cost of producing 2 gigaplots at Jimmy's Gigaplot factory?

$26.50

Refer to Table 13-8. What is the average fixed cost of producing 8 gigaplots at Jimmy's Gigaplot factory?

$3.13

Refer to Table 13-3. Each worker at Gallo's cork factory costs $12 per hour. The cost of each machine is $20 per day regardless of the number of corks produced. Assume the number of machines does not change. If Gallo's produces at a rate of 78 corks per hour, what is the total machine cost per day?

$40

Refer to Table 13-3. Each worker at Gallo's cork factory costs $12 per hour. The cost of each machine is $20 per day regardless of the number of corks produced. If Gallo's produces at a rate of 35 corks per hour, what is the total labor cost per hour?

$48

Refer to Table 13-3. Each worker at Gallo's cork factory costs $12 per hour. The cost of each machine is $20 per day regardless of the number of corks produced. What is the total daily cost of producing at a rate of 55 units per hour if Gallo's operates 8 hours per day?

$520

Refer to Table 13-3. Each worker at Gallo's cork factory costs $12 per hour. The cost of each machine is $20 per day regardless of the number of corks produced. If Gallo's produces at a rate of 70 corks per hour and operates 8 hours per day, what is Gallo's total labor cost per day?

$576

Refer to Table 13-5. The marginal cost of producing the sixth widget is

$6.00

Average total cost equals

(fixed cost + variable cost)/ quantity produced

Marginal cost equals

(i) and (ii)

Economists normally assume that the goal of a firm is to

(i) and (ii) are true

Refer to Figure 13-5. Which of the following can be inferred from the figure above?

(ii) and (iii)

Refer to Table 13-3. Assume Gallo's currently employs 2 workers. What is the marginal product of labor when Gallo's adds a 3rd worker?

10 corks

Refer to Table 13-3. Assume Gallo's currently employs 5 workers. What is the marginal product of labor when Gallo's adds a 6th worker?

15 corks per hour

Refer to Figure 13-6. Which of the curves is most likely to represent marginal cost?

A

Refer to Figure 13-6. Which of the curves is most likely to represent average total cost?

B

Refer to Figure 13-6. Which of the curves is most likely to represent average variable cost?

C

Refer to Figure 13-6. Which of the curves is most likely to represent average fixed cost?

D

Which of the following is true of the production function (not pictured) that underlies this total cost function

all of the above are correct

Marginal cost is equal to average total cost when

average total cost is at its minimum

When marginal cost is less than average total cost

average total cost is falling

Beth pays all her workers the same wage and labor is her only variable cost. From this information we can conclude that Beth's marginal cost

declines as output increases from 0 to 33, but increases after that

The changing slope of the total cost curve reflects

decreasing marginal product

With regard to cookie production, the figure implies

diminishing marginal product of workers

Refer to Figure 13-9. The three average total cost curves on the diagram correspond to three different

factory sizes

Industrial Organization is the study of how

firms' decisions regarding prices and quantities depend on the market conditions they face

Refer to Figure 13-9. The firm experiences diseconomies of scale if it changes its level of output

from Q4 to Q5

The marginal product of labor is equal to the

increase in output obtained from a one unit increase in labor

The efficient scale of the firm is the quantity of output that

minimizes average total cost

Refer to Scenario 13-4. Average variable cost will be

rising at all points

Refer to Scenario 13-4. Marginal cost will be

rising at all points

Refer to Table 13-3. Gallo's cork factory experiences diminishing marginal product of labor with the addition of which worker?

the 6th worker

Refer to Figure 13-6. Curve A is U-shaped because of

the fact that decreasing marginal product follows increasing marginal product

Which of the following is an implicit cost

the owner of a firm forgoing an opportunity to earn a large salary working for a wall street brokerage firm

As the number of workers increases

total output increases, but at a decreasing rate

The amount of money that a firm receives from the sale of its output is called

total revenue

Refer to Figure 13-7. Which of the figures represents the total cost curve for a firm?

Figure 2

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.