Ch. 5 Economics
Which of these is true of both an individual supply curve and a market supply curve?
A change in quantity supplied takes place only when there is a change in price
Which of these names the way in which producers regards taxes?
As part of the cost of production.
True or False: A producer's "marginal product" and "total product" are generally the same amount
False
True or False: Movement along the supply curve measures a change in supply
False
True or False: The third stage of production is distinguished by an increase in output.
False
What risk does a firm take by neglecting to do periodic marginal analysis?
It may lose track of its profit-maximizing quantity of output.
Which of these is the best description of a normal supply curve?
Its slope goes up when the diagram is read from left to right
Which of the following is not a classification of supply elasticity?
Per unit elasticity
______________ refers to the amount of a product offered for sale at all possible prices in a market.
Supply
Which of these best describes the influence of high prices on the behavior of consumers?
They are an incentive for consumers to buy less
______________ is the average price of a unit sold times the quantity sold
Total revenue
True or False: Changes to variable and fixed input are easiest during a "long run" production period
True
True or False: The production function is a graphic portrayal showing how a change in the amount of a single variable input affects total output.
True
True or False: The stages of production are distinguished by their rates of return
True
True or False: The stages of production measure the effects of workforce size on marginal product
True
Movement along a supply curve is called
a change in quantity supplied
The amount of capital available for manufacturing is an example of which of these?
a fixed factor of production
Which of these results from the repeal of an item's subsidies?
a leftward shift of that item's supply curve
The median price of a unit of output is called
average revenue
The ____________ is the level of production needed for a firm to recover its costs
break-even point
The production point where total cost equal total revenue is called the
break-even point
Which of these is an example of a fixed cost?
depreciation of capital goods
Stage of production where output increases at a decreasing rate as more units of variable input are added is called
diminishing marginal returns
When is a firm's rate of hiring likely to be highest?
during a phase of increasing marginal returns
Which recent development has lowered the fixed costs of many business?
e-commerce
Costs that do not change as output changes are called
fixed costs
Which terms describe costs that are incurred regardless of a firm's rate of production?
fixed costs and overhead
Which of these could a firm accomplish during a short run production period?
hiring and firing of workers
The additional expense of producing one additional unit is called ___________.
marginal cost
The extra cost of producing one more unit of production is called
marginal cost
The profit-maximizing quantity of output is reached when
marginal cost is equal to marginal revenue
The extra output due to the addition of one more unit of input is called
marginal product
The additional revenue generated from the sale of a single unit is called _____.
marginal revenue
The extra revenue from the sale of one additional unit of output is called
marginal revenue
A supply curve that shows the quantities offered at various prices by all firms that sell the same product in a given market is called a
market supply curve
The Law of Supply states that suppliers will
offer more at high prices than at lower prices
Total fixed costs are sometimes called
overhead
The amount offered for sale at a given price is called
quantity supplied
Which of these is an example of a variable cost?
raw materials
A payment made by government to a firm to encourage or protect a certain economic activity is called a
subsidy
A(n) _______ is a payment to an individual, business, or other group to encourage or protect a certain type of economic activity.
subsidy
The amount of product offered for sale at all possible prices is called
supply
A graph that shows the quantities supplied at each and every possible price in the market is called a
supply curve
A graph that shows the quantities supplied at each and every possible price in the market is called a ___________.
supply curve
Responsiveness of quantity supplied to a change in price is called
supply elasticity
A table showing the quantities offered for sale at each and every possible price in the market is called a
supply schedule
Which of these can be illustrated with a production function?
the effect of an increase in work hours on total output
A production period long enough to change the amount of variable and fixed inputs is called
the long run
A production period so short that only variable inputs can be changed is called
the short run
The phase of production that consist of increasing, decreasing and negative returns is called
the stages of production
Variable costs plus fixed costs equal
total cost
The total output or production of a firm is called
total product
The total amount earned by a firm from the sale of its products is called
total revenue
True or False: The average price that every unit of output sells for is called average revenue
true
Over which of these does the producer have the most direct control?
variable cost
Production cost that varies as the level of output changes are called
variable costs
Labor in a factory is an example of which of these?
variable factor of production
