Sec. 4,7,8,13
If an eyeglass business produces 10 pairs of eyeglasses and incurs $35 in average total cost and $5 in average fixed cost, then the average variable cost of producing 10 pairs of eyeglasses is:
$30.
Mark and Rasheed are at the bookstore buying new calculators for the semester. Mark is willing to pay $75 and Rasheed is willing to pay $100 for a graphing calculator. The price for a calculator at the bookstore is $65. How much is total consumer surplus?
$45
A farm can produce 1,000 bushels of wheat per year with two workers and 1,300 bushels of wheat per year with four workers. The marginal product of the fourth worker is:
150 bushels.
Women, regardless of ethnicity, earn about:
70 percent of the earnings of white men.
Which of the following is correct?
AVC= ATC-AFC
If total surplus rises, which statement must have occurred?
There was an increase in demand or an increase in supply.
A firm's demand curve for labor will shift because of:
a change in the product's price.
When the demand for automobiles is high, the demand for workers who build automobiles is high. This relation between the market for automobiles and the market for the labor that builds automobiles is why demand in a factor market is called:
a derived demand.
Consumption bundles that Mei cannot afford to consume because the bundles cost more than her income are:
beyond the budget line
A fixed cost:
can be positive, even if the firm doesn't produce any output in the short run.
Along a given downward-sloping demand curve, an increase in the price of a good will cause consumer surplus to:
decrease
Generally, each successive unit of a good consumed will cause marginal utility to
decrease
If the cost to download a song from the Internet falls from $0.99 to $0.50, then producer surplus would _____ in the market for MP3 players. Assume that the supply curve of MP3 players is upward sloping.
increase
In terms of labor supply, the substitution effect of a higher wage causes a(n):
increase in the quantity of labor supplied.
A decrease in the demand for pastry chefs may come about because of an:
increased concern for healthy living.
If a firm hires labor and with its current employees W = VMPL, then profit:
is maximized.
A firm's demand curve for labor is:
its VMPL curve.
Gabriella often faces a trade-off between time at the beach and time working as a model. She earns $40 per hour as a model and values going to the beach at the same price. When explaining this to her parents, she says, "The marginal utility I get from an hour of working is the same as the marginal utility I get from going to the beach." This is an illustration of which concept?
optimal time allocation
When drawing a total product curve, what is placed on the vertical axis of the graph?
quantity of output
The larger the output, the greater the quantity of output over which fixed cost is spread. Called the _____ effect, this leads to a _____.
spreading; lower average fixed cost
In economics, the short run is defined as:
the period in which some inputs are considered to be fixed in quantity.
Tim works 51 hours per week, and his wage is $35 per hour. If his wage increases to $70 per hour, then:
the substitution effect implies that he will work more.
Total consumer surplus can be measured for good X by:
the sum of the individual consumer surpluses for all buyers of X.
At quantities less than the long-run minimum cost per unit of output, the long-run average total cost curve is _____ of the corresponding short-run average total cost curve.
to the left of the minimum
Coffee and tea are substitutes in consumption. Assuming that the supply curve for tea is upward sloping, if there is an increase in the price of coffee, total surplus in the tea market:
will increase.
