economic
if the total fixed cost is $200, the total variable cost is $600, and total product is 4 units, then the average total cost must be
$200
refer to the provided table. the marginal cost of producing the sixth unit of output is
$25
the phrase "don't cry over spilt milk" could be rephrased in economic terms by saying,
"sunk costs are irrelevant to a decision"
marginal costs can be defined as the
change in total cost resulting from one more unit of production
marginal utility is the
change in total utility obtained by consuming one more unit of a good
to maximize utility, a consumer should allocate money income so that the
marginal utility obtained from the last dollar spent on each product is the same
suppose that MUx/Px exceeds MUy/Py. to maximize utility, the consumer who is spending all her money income should buy
more of X and/or less of Y
when total product is increasing at a decreasing rate, the marginal product is
positive and decreasing
(last word) from the viewpoint of potential criminals, the probability of being fired or imprisoned
raises the marginal cost or "price" of criminal behavior.
the substitution effect
refers to the change in the quantity demanded of a good due to a change in its relative price
suppose that Ms. thomson is currently exhausting her money income by purchasing 10 units of A and 8 units of B at prices of $2 and $4, respectively. the marginal utility of the last units of A and B are 16 and 24 respectively. these data suggest that Ms. Thomson
should buy less B and more A
assume you are spending your full budget and purchasing such amounts of X and Y that the marginal utility from the last units consumed is 40 and 20 utils, respectively. assume (a) the prices if X and Y are $8 and $4 respectively; (b) it takes 3 hours to consume a unit of X and ! hour to consume a unit of Y; and (c) your time is worth $2 per hour. you
should consume less of X and more of Y
refer to the table. the addition of which unit has the greatest marginal utility
sixth
implicit and explicit costs are different in that
the former refer to nonexpenditure costs and the latter to monetary payments
when the price of gasoline increases significantly, the delivery companies like UPS, fedex, and the USPS all find
their TVC curves shifting up
which of the following statements is correct
total utility is the accumulation or summation of marginal utility
the ability of a good or service to satisfy wants is called
utility
the diagram of product curve suggest that
when marginal product lies above average product, average product is rising
At what point does marginal product equal average product
where average product is equal to its maximum value
which of the following is not correct
where total product is at a maximum, average product is also at a maximum
where total utility is at a maximum, marginal utility is
zero
the table shows the marginal-utility schedule for goods A and B for a hypothetical consumer. the price of good A is $1, and the price of good B is $2. the income of the consumer is $8. if the price of A decreases, while the price of B and the consumer's income stay the same, we would expect
MU/P of A to increase, and the consumer will thus buy less of B
in the diagram, the range of diminishing marginal returns is
Q1Q3
in the short run
TVC will increase for a time at a diminishing rate, but then beyond some point will increase at an increasing rate
the main difference between the short run and the long run is that
in the short run, some inputs are fixed and some are variable
when the price of a product falls for a good, the
income and substitution effects will encourage consumers to purchase more of the product
refer to the provided graph showing the marginal product (MPl) and the average product of labor (APl). at which quantity of labor employed does diminishing marginal returns set in?
B
if the prices of X and Y are $2 and $4 per unit, respectively, and this consumer has $10 to income to spend, to maximize total utility, this consumer should buy
1 unit of X and 2 units of Y
answer the question on the basis of the following total utility data for products L and M. assume that the prices of L snd M are $3 and $4, respectively, and that the consumer's income is $18. how many units of the two products will the rational consumer purchase?
2 of L and 3 of M
refer to the data. the value of W is
20
answer the question based on the table below showing the marginal utility schedules for products X and product Y for a hypothetical consumer. the price of product X is $4, and the price of product y is $2. the income of the consumer is $20. if the consumer buys both product X and product Y, how much will the consumer buy of each to maximize utility?
3X and 4Y
answer the question on the basis of the following total utility data for products L and M. assume that the prices of L snd M are $3 and $4, respectively, and that the consumer's income is $18. what level of total utility does the rational consumer realize in equilibrium
51 units
the total output of a firm will be at a maximum where
MP id zero
an explicit cost is
a money payment made for resources not owned by the firm itself
economic cost can be defined as
a payment that must be made to obtain and retain the services of a resource
if MUa/Pa= 100/$35 = MUb/Pb=300/? = MUc/Pc =400/?, the prices of products B and C in consumer equilibrium
are $105 and $140, respectively
the law of diminishing returns indicates that
as extra units of a variable resource are added to a fixed resource, marginal product will decline beyond some point
diminishing marginal utility explains why
demand curves are downsloping
to the economist, total cost includes
explicit and implicit costs
if you owned a small farm, which of the following would most likely be a fixed cost
hail insurance