econ quiz
A firm is producing 100 units of output at a total cost of $400. The firm's average variable cost is $3 per unit. What is the firm's total fixed cost?
$100
Given the information above, the average variable cost of 25 units of output is
$2
The average fixed cost of producing four units of output is equal to
$30
If a firm's production function exhibits diminishing marginal product of the variable input in the short run, which of the following about the firm's short-run marginal cost (MC) curve must be true?
As output increases, the MC curve slopes upward.
The table below shows a competitive firm's total variable cost (TVC) and total fixed cost (TFC) at various units of output.
Average Variable Cost 5 Marginal Cost 7
In the short run, which of the following costs must continuously decrease as output produced increases?
Average fixed cost
The table below shows a production function for a firm. All of the following can be concluded from the information in the table EXCEPT:
This is a production function for a perfectly competitive firm.
Based on the short-run production function graph above showing the relationship between the quantity of labor and total product, which of the following statements is true?
Total product is maximized when marginal product is zero.
The table below is partially filled in with the different types of costs for a firm. Based on the information in the table, what is the marginal cost of producing the second unit?
$50
The table above shows a firm's total cost of producing various units of output. What is the average variable cost of producing three units?
$7
The table above shows the amount of labor inputs necessary to produce given levels of output. If the cost of a unit of labor is $20 and total fixed cost is $100, the average total cost of producing 20 units of output is
$7
Given the production schedule above, what is the maximum number of workers the firm can hire before the effects of diminishing marginal returns set in?
2
According to the table above, which shows the costs of production for a firm, the average total cost of producing 3 units of output is
20.00
The following two questions refer to the data in the table below. A perfectly competitive firm operates with a fixed amount of capital that costs $1,000$1,000 per day. Labor is the only variable input. The firm hires labor in a perfectly competitive labor market at $100$100 per day per worker. The table below shows the firm's production function. What is the marginal product of the third worker?
24
Locotek produces toy trains and pays each worker $350 per week. Five workers can produce 40 trains per week and six workers can produce 45 trains per week. The marginal product per week of the sixth worker is
5 trains
In microeconomics, the short run is defined as which of the following?
A period during which some inputs in a firm's production process cannot be changed
Which of the following must be true if at the tenth unit of output, marginal cost (MC) is $130 and average total cost (ATC) is $150 ?
ATC of producing the ninth unit is higher than $150
Suppose labor and capital can be hired in a competitive market. The wage is $15 per worker and the rental rate of capital is $10 per unit. Based on the table, what are the average variable cost (AVC) and average total cost (ATC) of producing 10 units of output?
AVC is $6 and ATC is $11
Which of the following factors can cause a firm's cost curves to shift upward?
An increase in wages
Which of the following is true of the marginal cost curve?
It intersects the average variable cost curve and the average total cost curve at each curve's minimum point.
In the short run, which of the following is true of a firm's average total cost of production?
It is equal to average fixed cost plus average variable cost.
The table above shows the short-run production function for picking apples. Based on the production data, which of the following statements about the marginal product of the fifth worker is true?
It is less than the marginal product of the third worker due to diminishing returns.
A competitive firm produces a product using labor and plastic. The firm is initially in equilibrium. If the cost of plastic suddenly increases, which of the following will occur?
The firm's marginal costs will increase at each level of output.
Assume the marginal product of labor first rises, reaches a maximum, and then falls. If the average product of labor is falling, which of the following is true?
The marginal product of labor must be falling.
An increase in which of the following will cause a firm's marginal cost curve to shift upward?
The price of a variable input
As output of a firm increases, the difference between the firm's average total cost and its average variable cost gets smaller because the firm's
average fixed cost is decreasing
Marginal cost is defined as the
change in total cost resulting from producing an additional unit of output
Suppose that a firm begins to hire workers for a newly completed plant with a fixed amount of machinery. As the firm hires additional workers, one would expect the marginal product to
rise initially, but eventually fall