Chapter 11: Technology, Production, and Cost
According to the table, what is the average total cost of producing 550 pizzas?
$5
According to the graph, over what range of output do we find constant returns to scale in bookselling?
Between 20,000 and 40,000 books
Based on the relationship between average total cost and marginal cost, which of the curves appears to be average total cost?
Curve 2
According to the graph, which of the following is more likely to occur when moving from point A to point B?
Diminishing Returns
What is the name for the additional output that a firm produces as a result of hiring one more worker?
Marginal product of labor
Which of these costs are affected by the level of output produced?
Variable costs
Minimum efficient scale is the level of output at which:
all economies of scale have been exhausted
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
According to the graph, what size bookstore is more likely to experience diseconomies of scale?
bookstores that sell more than 80,000 books per month
The downward sloping part of the long run average total cost curve is where the firm is achieving:
economies of scale
According to the graph, which change in output represents economies of scale in bookselling?
from 1,000 to 20,000 books sold per month
When the marginal product of labor is greater than the average product of labor, then the average product of labor must be:
increasing
The relationship between the inputs used by the firm and the maximum output it can produce is known as the:
production function
When graphing a conventional short-run production function, we place __________ on the horizontal axis and __________ on the vertical axis.
the variable input, output
According to the graph, which level of output represents the minimum efficient scale in bookselling?
20,000
In the short-run, the cost that is independent of the amount of output produced is called __________.
Fixed cost