Chapter 22 Assignment
Mark's Chair Factory currently employs 100 workers, who produce 800 chairs. If Mark hires a 101st worker, output will rise to 925. What is the marginal physical product of the 101st worker?
125
At its current short-run level of production, a firm's average variable costs equal $15 per unit, and its average fixed costs equal $30 per unit. Its total costs at this production level equal $900. What is the firm's current output level? __units. What are the total variable costs at this output level? $__. What are the total fixed costs?
20 900/45=20 300 15(20)=300 600 30(20)=600
Anthony's Chair Factory currently employs 100 workers, who produce 800 chairs. If Anthony hires a 101st worker, output will rise to 925. What is the average physical product of the 101st worker?
9.16 925/101=9.16
Which of the following statements described a firm's long-run average cost curve?
A U-shaped curve that represents the minimum unit cost of producing any given rate of output.
Which of the following statements describes a firm's long-run average cost curve?
A U-shaped curve that represents the minimum unit cost of producing any given rate of output.
Why does the marginal physical product of labor eventually decline as more labor is used with another fixed input?
The labor will have, on average, fewer units of the other inputs to combine with and the increase to total output obtained from more labor will decrease.
In economics, the planning horizon is define as
The long run, during which all inputs are variable.
Which of the following is true about the long-run average cost curve?
The long-run average cost curve is the envelope of firm's short-run average cost curves.
Which is a firm's minimum efficient scale?
The lowest rate of output at which the firm achieves minimum long-run average cost.
If total physical product is increasing at a decreasing rate, then marginal physical product is
decreasing
The law of diminishing marginal returns shows the relationship between
inputs and outputs for a firm in the short run
The wage rate divided by marginal product equals
marginal cost.
If a firm hires an additional worker and discovers that its total physical output has fallen, then it must be true that
marginal physical product is negative.
When marginal cost is falling
marginal physical product must be rising.
The long-run average cost curve
represents the various average costs attainable at the planning stage of the firm's decision making.
When the long-run average cost curve is falling
the firm is experiencing economies of scale.
The shape of this short-run cost curves are the result of
the law of diminishing returns.