Micro chapter 8

shift the firm's ATC and MC curves upward by the full amount of the tax

A 10-cent-per-box tax on producers of cigars will

diseconomies of scale

A car leasing company that expands its size by buying its competitors may run the risk of increasing production costs due to

economies of scale

A downward-sloping portion of a long-run average total cost curve is the result of

fixed costs are greater than zero

A fruit packing plant usually shuts down for three months each year. During that period, its

of economies of scale

A large aircraft manufacturer, like Boeing, may have a cost advantage over a new smaller manufacturer because

because funds invested in the firm could be earning interest elsewhere

Interest foregone on financial capital invested in a firm represents an economic cost

the interest income foregone on the equity capital invested by owners

Which of the following items is most likely to be an implicit cost of production?

an increase in government regulations

Which of the following would cause a firm's cost curves to shift upward?

You study eight hours for a final exam even though there is no way now that you can pass the course

Which one of the following decisions most clearly reflects a lack of understanding of the concept of sunk costs?

false because a business decision maker may be covering his current variable costs even though he has failed to cover all previous production costs.

"A good business decision maker will never sell a product for less than it costs to produce." This statement is