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Exam 9: The Firm: Cost and Output Determination

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Question 71

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If average total cost is decreasing as more and more units are produced,then marginal cost must be

A) rising.
B) constant.
C) below average total cost.
D) negative.

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Question 72

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For an industry in which average costs continue to decline as output rises,what would you expect the minimum efficient scale to be? Explain your answer.

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When average costs continue to decline a...

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Question 73

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-Refer to the above figure.The curve reflects

At Phil's Hot Dog Stand,we found the following: 4 laborers produced 66 hot dogs 5 laborers produced 76 hot dogs 6 laborers produced 84 hot dogs 7 laborers produced 88 hot dogs What was the marginal physical product of the sixth laborer?

In economics,a fixed cost is a cost that

When marginal product is rising,

An increase in long-run average costs resulting from decreases in output is

The amount of calendar time associated with the long run

The production function

The change in total product occurring when a variable input is increased and all other inputs are held constant is

A firm has the following production relationship between labor and output,for a fixed capital stock. $\begin{array} { c r } \hline\text { Labor } & \text { Output } \\\hline0 & 0 \\1 & 5 \\2 & 11 \\3 & 18 \\4 & 23 \\5 & 26\\\hline\end{array}$ -According to the above table,at what usage of labor does diminishing marginal product begin?

$\begin{array} { l l l l l l l } \text { Q } & \text { TFC } & \text { TVC } & \text { TC } & \text { AFC } & \text { AVC } & \text { ATC } \\1 & & & & & & \\2 & & & & \$ 75 & \$ 25 & \\3 & & & & & \$ 40 & \\\hline\end{array}$ -Refer to the above table.What are total variable costs at an output of 2 units?

Which of the following is true?

If the marginal product of an input is falling,then

-Use the above figure.The ATC at output 10 is

$\begin{array} { l c r l } \text { Q } & \text { TFC } & \text { TVC } & \text { TC } \\\hline 0 & \$ 90 & \$ 0 & \$ 90 \\1 & 90 & 25 & 115 \\2 & 90 & 32 & 122 \\3 & 90 & 42 & 132 \\4 & 90 & 64 & 154 \\5 & 90 & 95 & 185\end{array}$ -Refer to the above table.When output rises from 2 units to 3 units,marginal costs are

"The short-run average total cost curve and the long-run average cost curve are both U-shaped for the same reasons." Do you agree or disagree? Why?

$\begin{array} { c c } \text { Total Output } & \text { Total Costs } \\\hline 0 & \$ 10 \\1 & 18 \\2 & 21 \\3 & 23 \\4 & 24 \\5 & 26 \\6 & 29 \\7 & 33 \\8 & 38 \\9 & 44 \\10 & 51\end{array}$ -In the above table,the marginal cost of the ninth unit is

$\begin{array}{l}\begin{array} {lll } \text {Quantity of}&\text {Total}\\Labor & Product \\\hline 1 & 20 \\2 & 46 \\3 & 63 \\4 & 72\\\hline\end{array}\end{array}$ -Refer to the above table.What does the marginal product equal when the quantity of labor goes from 3 to 4?

Another term for the total quantity of output is