Microeconomics Assignment 3 Part 5
Assume that in the short run a firm is producing 100 units of output, has average total costs of $200, and has average variable costs of $150. The firm's total fixed costs are: A. $5,000. B. $0.50. C. $50. D. $500.
A
The law of diminishing returns describes the: A. relationship between resource inputs and product outputs in the short run. B. profit-maximizing position of a firm. C. relationship between total costs and total revenues. D. relationship between resource inputs and product outputs in the long run.
A
The more time consumers have to adjust to a change in price: A. the greater will be the price elasticity of demand. B. the more likely the product is a normal good. C. the more likely the product is an inferior good. D. the smaller will be the price elasticity of demand.
A
A firm can sell as much as it wants at a constant price. Demand is thus: A. perfectly inelastic. B. perfectly elastic. C. relatively inelastic. D. relatively elastic.
B
Answer the question on the basis of the accompanying table that shows average total costs (ATC) for a manufacturing firm whose total fixed costs are $10: Refer to the data. The total cost of producing 4 units of output is: A. $31. B. $124. C. $87. D. $137.
B
Answer the question on the basis of the following cost data: Refer to the data. The marginal cost of the fifth unit of output is: A. $3. B. $80. C. $78. D. $62.
B
Suppose that a business incurred implicit costs of $200,000 and explicit costs of $1 million in a specific year. If the firm sold 4,000 units of its output at $300 per unit, its accounting profits were: A. zero and its economic loss was $200,000. B. $200,000 and its economic profits were zero. C. $100,000 and its economic profits were $100,000. D. $100,000 and its economic profits were zero.
B
Economic cost can best be defined as: A. any contractual obligation that results in a flow of money expenditures from an enterprise to resource suppliers. B. any contractual obligation to labor or material suppliers. C. a payment that must be made to obtain and retain the services of a resource. D. all costs exclusive of payments to fixed factors of production.
C
If the demand for product X is inelastic, a 4 percent increase in the price of X will: A. increase the quantity of X demanded by less than 4 percent. B. decrease the quantity of X demanded by more than 4 percent. C. increase the quantity of X demanded by more than 4 percent. D. decrease the quantity of X demanded by less than 4 percent.
D
In the short run the Sure-Screen T-Shirt Company is producing 500 units of output. Its average variable costs are $2.00 and its average fixed costs are $.50. The firm's total costs: A. are $2.50. B. are $1,100. C. are $750. D. are $1,250.
D
The demand for a luxury good whose purchase would exhaust a big portion of one's income is: A. perfectly price inelastic. B. perfectly price elastic. C. relatively price inelastic. D. relatively price elastic.
D