review for midterm
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Review Questions for Midterm-1
Multiple Choice Identify the choice that best completes the statement or answers the question.
____ 1. An increase in quantity demanded
a. results in a movement downward and to the right along a demand curve. b. results in a movement upward and to the left along a demand curve. c. shifts the demand curve to the left. d. shifts the demand curve to the right.
Table 4-1
Price Quantity Demanded by Michelle
Quantity Demanded by Laura
Quantity Demanded by Hillary
$5 5 4 11 $4 6 6 13 $3 7 8 15 $2 8 10 17 $1 9 12 19 $0 10 14 21
____ 2. Refer to Table 4-1. If the market consists of Michelle, Laura, and Hillary and the price falls by $1, the
quantity demanded in the market increases by a. 2 units. b. 3 units. c. 4 units. d. 5 units.
____ 3. Refer to Table 4-1. If the market consists of Michelle and Laura only and the price falls by $1, the quantity demanded in the market increases by a. 2 units. b. 3 units. c. 4 units. d. 5 units.
Figure 4-4
Demand CDemand BDemand A
Quantity
Price
____ 4. Refer to Figure 4-4. Which of the following would cause the demand curve to shift from Demand C to
Demand A in the market for DVDs? a. an increase in the price of DVDs b. a decrease in the price of DVD players c. a change in consumer preferences toward watching movies in movie theaters rather than at
home d. an expectation by buyers that their incomes will increase in the very near future
Figure 4-5
Demand 1Demand 2
AB
Panel 1
1 2 3 4 5 6 7 8 Quantity
1
2
3
4
5
6
7
8
9
10Price
Demand 1
A
C
Panel 2
1 2 3 4 5 6 7 8 Quantity
1
2
3
4
5
6
7
8
9
10Price
____ 5. Refer to Figure 4-5. Suppose that the federal government is concerned about obesity in the United States.
Congress is considering two plans. One would require “junk food” producers to include warning labels on all junk food. The other would impose a tax on all products considered to be junk food. If the warning labels are successful, we could illustrate the plan as producing a movement from a. Point A to Point B in Panel 1. b. Point B to Point A in Panel 1. c. Point A to Point C in Panel 2. d. Point C to Point A in Panel 2.
____ 6. Two goods are substitutes when a decrease in the price of one good a. decreases the demand for the other good.
b. decreases the quantity demanded of the other good. c. increases the demand for the other good. d. increases the quantity demanded of the other good.
____ 7. Two goods are complements when a decrease in the price of one good a. decreases the quantity demanded of the other good. b. decreases the demand for the other good. c. increases the quantity demanded of the other good. d. increases the demand for the other good.
Figure 4-7
Panel (a) Panel (b)
D
P'
P
Q' Q quantity
price
D' D
quantity
price
____ 8. Refer to Figure 4-7. The graphs show the demand for cigarettes. In Panel (a), the arrows are consistent
with which of the following events? a. The price of marijuana, a complement to cigarettes, increased. b. Mandatory health warnings were placed on cigarette packages. c. Several foreign countries banned U.S. cigarettes in their countries. d. A tax was placed on cigarettes.
Table 4-8 A country club usually only allows members to purchase tickets for its celebrity golf tournament, but the club is considering allowing non-members to purchase tickets this year. The demand and supply schedules are as follows: Price Quantity Demanded
by Members Quantity Demanded
by Non-members Quantity Supplied
$10 1000 500 600 $15 800 400 600 $20 600 300 600 $25 400 200 600 $30 200 100 600
____ 9. Refer to Table 4-8. If only members are allowed to purchase tickets to this year's celebrity golf tournament,
then what will be the equilibrium price? a. $10 b. $15
c. $20 d. $25
____ 10. Refer to Table 4-8. If both members and non-members are allowed to purchase tickets to this year's celebrity golf tournament, then what will be the equilibrium price? a. $10 b. $15 c. $20 d. $25
Figure 4-15
S
D
100 200 300 400 500 600 700 800 quantity
5
10
15
20
25
30
35
40
45
50price
____ 11. Refer to Figure 4-15. Equilibrium price and quantity are, respectively,
a. $15 and 200 units. b. $25 and 600 units. c. $25 and 400 units. d. $35 and 200 units.
____ 12. Refer to Figure 4-15. At the equilibrium price, a. 200 units would be supplied and demanded. b. 400 units would be supplied and demanded. c. 600 units would be supplied and demanded. d. 600 units would be supplied, but only 200 would be demanded.
Figure 4-21
Demand 1 Demand 2
Supply 1 Supply 2
A
B
C
D
Quantity
Price
____ 13. Refer to Figure 4-21. Which of the following movements would illustrate the effect in the market for golf
balls of an increase in green fees? a. Point A to Point B b. Point C to Point B c. Point C to Point D d. Point A to Point D
Figure 4-22
Panel (a) Panel (b)
D D'
S
Pe'
Pe
Qe Qe' quantity
price
D' D
S
Pe
Pe'
Qe' Qe quantity
price
Panel (c) Panel (d)
D
S'S
Pe'
Pe
Qe Qe' quantity
price
D
SS'
Pe
Pe'
Qe' Qe quantity
price
____ 14. Refer to Figure 4-22. Panel (a) shows which of the following?
a. an increase in demand and an increase in quantity supplied b. an increase in demand and an increase in supply c. an increase in quantity demanded and an increase in quantity supplied d. an increase in quantity demanded and an increase in supply
____ 15. Refer to Figure 4-22. Panel (b) shows which of the following? a. a decrease in demand and a decrease in quantity supplied b. a decrease in demand and a decrease in supply c. a decrease in quantity demanded and a decrease in quantity supplied d. a decrease in quantity demanded and a decrease in supply
____ 16. In general, elasticity is a measure of a. the extent to which advances in technology are adopted by producers. b. the extent to which a market is competitive. c. how firms’ profits respond to changes in market prices. d. how much buyers and sellers respond to changes in market conditions.
____ 17. When consumers face rising gasoline prices, they typically a. reduce their quantity demanded more in the long run than in the short run. b. reduce their quantity demanded more in the short run than in the long run. c. do not reduce their quantity demanded in the short run or the long run. d. increase their quantity demanded in the short run but reduce their quantity demanded in
the long run.
____ 18. Which of the following is not a determinant of the price elasticity of demand for a good? a. the time horizon b. the steepness or flatness of the supply curve for the good c. the definition of the market for the good d. the availability of substitutes for the good
____ 19. The greater the price elasticity of demand, the a. more likely the product is a necessity. b. smaller the responsiveness of quantity demanded to a change in price. c. greater the percentage change in price over the percentage change in quantity demanded. d. greater the responsiveness of quantity demanded to a change in price.
____ 20. Suppose that Juan Carlos is filling out a survey that he received in the mail. The survey asks him what he would do if the price of his favorite toothpaste increased. Juan Carlos reports that he would switch to a different brand. The survey asks what he would do if the price of all toothpastes increased. Juan Carlos reports that he must use toothpaste, so he would have to adjust his spending elsewhere. These examples illustrate the importance of a. changes in total revenue in determining the price elasticity of demand. b. a necessity versus a luxury in determining the price elasticity of demand. c. the definition of a market in determining the price elasticity of demand. d. the time horizon in determining the price elasticity of demand.
____ 21. If the price elasticity of demand for a good is 0.25, then a 20 percent decrease in price results in a a. 0.0125 percent increase in the quantity demanded. b. 4 percent increase in the quantity demanded. c. 5 percent increase in the quantity demanded. d. 80 percent increase in the quantity demanded.
____ 22. When the price of a good is $5, the quantity demanded is 100 units per month; when the price is $7, the quantity demanded is 80 units per month. Using the midpoint method, the price elasticity of demand is about a. 0.22. b. 0.67. c. 1.33. d. 1.50.
____ 23. When the price of a good is $5, the quantity demanded is 120 units per month; when the price is $7, the quantity demanded is 100 units per month. Using the midpoint method, the price elasticity of demand is about a. 0.55. b. 1.83. c. 2. d. 10.
____ 24. When the price of a bracelet was $25 each, the jewelry shop sold 20 per month. When it raised the price to $35 each, it sold 14 per month. Using the midpoint method, the price elasticity of demand for bracelets is about a. 1.66. b. 1.06. c. 0.94. d. 0.60.
____ 25. Which of the following expressions is valid for the price elasticity of demand? a.
Price elasticity of demand = .
b. Price elasticity of demand = .
c. Price elasticity of demand = .
d. Price elasticity of demand = .
____ 26. The case of perfectly elastic demand is illustrated by a demand curve that is a. vertical. b. horizontal.
c. downward-sloping but relatively steep. d. downward-sloping but relatively flat.
____ 27. In the case of perfectly inelastic demand, a. the change in quantity demanded equals the change in price. b. the percentage change in quantity demanded equals the percentage change in price. c. infinitely-large changes in quantity demanded result from very small changes in the price. d. quantity demanded stays the same whenever price changes.
Figure 5-2
Pa
Pb
D1
D2D3
Quantity
Price
____ 28. Refer to Figure 5-2. As price falls from Pa to Pb, which demand curve represents the most elastic demand?
a. D1 b. D2 c. D3 d. All of the above are equally elastic.
____ 29. Suppose that when the price of wheat is $2 per bushel, farmers can sell 10 million bushels. When the price of wheat is $3 per bushel, farmers can sell 8 million bushels. Which of the following statements is true? The demand for wheat is a. income inelastic, so an increase in the price of wheat will increase the total revenue of
wheat farmers. b. income elastic, so an increase in the price of wheat will increase the total revenue of wheat
farmers. c. price inelastic, so an increase in the price of wheat will increase the total revenue of wheat
farmers. d. price elastic, so an increase in the price of wheat will increase the total revenue of wheat
farmers.
____ 30. A city wants to raise revenues to build a new municipal swimming pool next year. The mayor suggests that the city raise the price of admission to the current municipal pools this year to raise revenues. The city manager suggests that the city lower the price of admission to raise revenues. Who is correct? a. the mayor b. the city manager c. The answer depends on the price elasticity of demand. d. The answer depends on the costs of construction of the new municipal swimming pool.
____ 31. A city wants to raise revenues to build a new municipal swimming pool next year. The mayor suggests that the city raise the price of admission to the current municipal pools this year to raise revenues. The city manager suggests that the city lower the price of admission to raise revenues. Who is correct? a. Both the mayor and city manager would be correct if demand were price elastic. b. Both the mayor and city manager would be correct if demand were price inelastic. c. The mayor would be correct if demand were price elastic; the city manager would be
correct if demand were price inelastic. d. The mayor would be correct if demand were price inelastic; the city manager would be
correct if demand were price elastic.
____ 32. Which of the following could be the price elasticity of demand for a good for which a decrease in price would increase revenue? a. 0 b. 0.2 c. 1 d. 2.1
____ 33. Which of the following could be the price elasticity of demand for a good for which an increase in price would increase revenue? a. 0.2 b. 1 c. 1.5 d. All of the above could be correct.
____ 34. Total revenue a. always increases as price increases. b. increases as price increases, as long as demand is elastic. c. decreases as price increases, as long as demand is inelastic. d. remains unchanged as price increases when demand is unit elastic.
Figure 5-4
Demand
A
B
C Quantity
Price
____ 35. Refer to Figure 5-4. Suppose the point labeled B is the “halfway point” on the demand curve and it
corresponds to a price of $5.00. Then, between prices of $4.99 and $5.01, the price elasticity of demand is a. less than 1 but greater than zero. b. equal to 1. c. greater than 1.
d. equal to zero.
Figure 5-5
Demand
3 6 9 12 15 18 21 24 27 30 33 Quantity
6
12
18
24
30
36
42
48
54
60Price
____ 36. Refer to Figure 5-5. Using the midpoint method, demand is unit elastic between prices of
a. $18 and $24. b. $24 and $30. c. $24 and $36. d. $30 and $36.
____ 37. Refer to Figure 5-5. Using the midpoint method, between prices of $12 and $18, price elasticity of demand is a. 0.33. b. 0.67. c. 1.33. d. 1.89.
Figure 5-12
Demand
P2
P1
Q2 Q1
A
B
C
D
Quantity
Price
____ 38. Refer to Figure 5-12. Total revenue when the price is P1 is represented by the area(s)
a. B + D. b. A + B. c. C + D.
d. D.
____ 39. Refer to Figure 5-12. Total revenue when the price is P2 is represented by the area(s) a. B + D. b. A + B. c. C + D. d. D.
Table 5-6 Income
Quantity of Good X Purchased
Quantity of Good Y Purchased
$30,000 2 20 $40,000 6 10
____ 40. Refer to Table 5-6. Using the midpoint method, what is the income elasticity of demand for good X?
a. -3.5 b. -0.29 c. 0.29 d. 3.5
____ 41. For which of the following goods is the income elasticity of demand likely highest? a. natural gas b. doctor’s visits c. hamburgers d. boats
____ 42. If an increase in income results in a decrease in the quantity demanded of a good, then for that good, the a. cross-price elasticity of demand is negative. b. price elasticity of demand is elastic. c. income elasticity of demand is negative. d. income elasticity of demand is positive.
____ 43. To determine whether a good is considered normal or inferior, one could examine the value of the a. income elasticity of demand for that good. b. price elasticity of demand for that good. c. price elasticity of supply for that good. d. cross-price elasticity of demand for that good.
____ 44. You and your college roommate eat three packages of Ramen noodles each week. After graduation last month, both of you were hired at several times your college income. You still enjoy Ramen noodles very much and buy even more, but your roommate plans to buy fewer Ramen noodles in favor of foods she prefers more. When looking at income elasticity of demand for Ramen noodles, yours would a. be negative, and your roommate's would be positive. b. be positive, and your roommate's would be negative. c. be zero, and your roommate's would approach infinity. d. approach infinity, and your roommate's would be zero.
____ 45. Suppose that when the price of good X falls from $10 to $8, the quantity demanded of good Y rises from 20 units to 25 units. Using the midpoint method, the cross-price elasticity of demand is a. -1.0, and X and Y are complements. b. -1.0, and X and Y are substitutes. c. 1.0, and X and Y are complements.
d. 1.0, and X and Y are substitutes.
____ 46. Which of the following expressions represents a cross-price elasticity of demand? a. percentage change in quantity demanded of bread divided by percentage change in
quantity supplied of bread b. percentage change in quantity demanded of bread divided by percentage change in price of
butter c. percentage change in price of bread divided by percentage change in quantity demanded of
bread d. percentage change in quantity demanded of bread divided by percentage change in income
____ 47. If the cross-price elasticity of two goods is negative, then the two goods are a. necessities. b. complements. c. normal goods. d. inferior goods.
____ 48. If the cross-price elasticity of demand for two goods is -4.5, then a. the two goods are substitutes. b. the two goods are complements. c. one of the goods is normal while the other good is inferior. d. one of the goods is a luxury while the other good is a necessity.
____ 49. The price elasticity of supply measures how responsive a. equilibrium price is to equilibrium quantity. b. sellers are to a change in buyers' income. c. sellers are to a change in price. d. consumers are to the number of substitutes.
____ 50. A key determinant of the price elasticity of supply is the time period under consideration. Which of the following statements best explains this fact? a. Supply curves are steeper over long periods of time than over short periods of time. b. Buyers of goods tend to be more responsive to price changes over long periods of time
than over short periods of time. c. The number of firms in a market tends to be more variable over long periods of time than
over short periods of time. d. Firms prefer to change their prices in the short run rather than in the long run.
____ 51. If the price elasticity of supply is 1.5, and a price increase led to a 1.8% increase in quantity supplied, then the price increase is about a. 0.67%. b. 0.83%. c. 1.20%. d. 2.70%.
____ 52. If the price elasticity of supply is 1.5, and a price increase led to a 3% increase in quantity supplied, then the price increase is about a. 0.2%. b. 0.5%. c. 2.0%. d. 4.5%.
Figure 5-17
SupplyA
Quantity
Price
Supply B
Quantity
PriceSupply C
Quantity
Price
Supply D
Quantity
Price
____ 53. Refer to Figure 5-17. Which of the following statements is not correct?
a. Supply curve A is perfectly inelastic. b. Supply curve B is perfectly elastic. c. Supply curve C is unit elastic. d. Supply curve D is more elastic than supply curve C.
____ 54. Economists assume that the goal of the firm is to maximize total a. revenue. b. profits. c. costs. d. satisfaction.
____ 55. Total revenue equals a. price x quantity. b. price/quantity. c. (price x quantity) - total cost. d. output - input.
____ 56. Trevor’s Tire Company produced and sold 500 tires. The average cost of production per tire was $50. Each tire sold for a price of $65. Trevor’s Tire Company’s total costs are a. $7,500. b. $25,000. c. $32,500. d. $67,500.
____ 57. A certain firm manufactures and sells computer chips. Last year it sold 2 million chips at a price of $10 per chip. For last year, the firm's a. accounting profit was $20 million. b. economic profit was $20 million. c. total revenue was $20 million. d. explicit costs was $20 million.
____ 58. Total cost is the a. amount a firm receives for the sale of its output. b. fixed cost less variable cost. c. market value of the inputs a firm uses in production. d. quantity of output minus the quantity of inputs used to make a good.
____ 59. Profit is defined as a. net revenue minus depreciation. b. total revenue minus total cost. c. average revenue minus average total cost. d. marginal revenue minus marginal cost.
____ 60. Billy’s Bean Bag Emporium produced 300 bean bag chairs but sold only 275 of the units it produced. The average cost of production for each unit of output produced was $100. The price for each of the 275 units sold was $95. Total profit for Billy’s Bean Bag Emporium would be a. -$3,875. b. $26,125. c. $28,500. d. $30,000.
____ 61. Wiladee used to work as an office manager, earning $25,000 per year. She gave up that job to start a tailoring business. In calculating the economic profit of her tailoring business, the $25,000 income that she gave up is counted as part of the tailoring firm's a. total revenue. b. opportunity costs. c. explicit costs. d. marginal costs.
____ 62. John has decided to start his own lawn-mowing business. To purchase the mowers and the trailer to transport the mowers, John withdrew $1,000 from his savings account, which was earning 3% interest, and borrowed an additional $2,000 from the bank at an interest rate of 7%. What is John's annual opportunity cost of the financial capital that has been invested in the business? a. $30 b. $140 c. $170 d. $300
____ 63. Gloria has decided to start her own snow removal business. To purchase the necessary equipment, Gloria withdrew $2,000 from her savings account, which was earning 3% interest, and borrowed an additional $4,000 from the bank at an interest rate of 7%. What is Gloria's annual opportunity cost of the financial capital that has been invested in the business? a. $60 b. $280 c. $340 d. $660
____ 64. Zach has decided to start his own photography studio. To purchase the necessary equipment, Zach withdrew $10,000 from his savings account, which was earning 3% interest, and borrowed an additional $5,000 from the bank at an interest rate of 8%. What is Zach's annual opportunity cost of the financial capital that has been invested in the business? a. $300 b. $400 c. $700 d. $1,650
____ 65. Explicit costs a. require an outlay of money by the firm. b. include all of the firm's opportunity costs. c. include the value of the business owner’s time. d. Both b and c are correct.
____ 66. Which of the following is an example of an implicit cost? (i) the owner of a firm forgoing an opportunity to earn a large salary working for a Wall
Street brokerage firm
(ii) interest paid on the firm's debt (iii) rent paid by the firm to lease office space a. (ii) and (iii) only b. (i) and (iii) only c. (i) only d. (iii) only
____ 67. Walter used to work as a high school teacher for $40,000 per year but quit in order to start his own painting business. To invest in his painting business, he withdrew $20,000 from his savings, which paid 3 percent interest, and borrowed $30,000 from his uncle, whom he pays 3 percent interest per year. Last year Walter paid $25,000 for supplies and had revenue of $60,000. Walter asked Tyler the accountant and Greg the economist to calculate his painting business’s profit. a. Tyler says his profit is $25,900, and Greg says his profit is $66,500. b. Tyler says his profit is $35,000, and Greg says he lost $5,900. c. Tyler says his profit is $34,100, and Greg says he lost $6,500. d. Tyler says his profit is $34,100, and Greg says his profit is $34,100.
____ 68. Katherine gives piano lessons for $15 per hour. She also grows flowers, which she arranges and sells at the local farmer’s market. One day she spends 5 hours planting $50 worth of seeds in her garden. Once the seeds have grown into flowers, she can sell them for $150 at the farmer’s market. Katherine’s accounting profits are a. $100, and her economic profits are $25. b. $100, and her economic profits are $75. c. $25, and her economic profits are $100. d. $75, and her economic profits are $125.
____ 69. A production function is a relationship between inputs and a. quantity of output. b. revenue. c. costs. d. profit.
Figure 13-1
TP2
TP1
Inputs
Output
____ 70. Refer to Figure 13-1. Suppose the production function shifts from TP1 to TP2. Such a shift in the total
product curve is most likely due to an increase in the firm's
a. costs of production. b. productivity. c. product price. d. market share.
____ 71. Refer to Figure 13-1. Suppose the production function shifts from TP2 to TP1. Such a shift in the total product curve is most likely due to a decrease in the firm's a. costs of production. b. product price. c. market share. d. productivity.
____ 72. The marginal product of labor is equal to the a. incremental cost associated with a one unit increase in labor. b. incremental profit associated with a one unit increase in labor. c. increase in labor necessary to generate a one unit increase in output. d. increase in output obtained from a one unit increase in labor.
Table 13-1 Number of Workers Total Output Marginal Product
0 0 -- 1 30 2 40 3 50 4 40 5 30
____ 73. Refer to Table 13-1. What is total output when 2 workers are hired?
a. 10 b. 40 c. 70 d. 120
____ 74. Refer to Table 13-1. What is total output when 3 workers are hired? a. 10 b. 40 c. 70 d. 120
Table 13-2 Number of Workers
Total Output
Marginal Product
0 0 -- 1 200 2 450 3 600 4 650
____ 75. Refer to Table 13-2. What is the marginal product of the first worker?
a. 250 units
b. 200 units c. 150 units d. 50 units
____ 76. Refer to Table 13-2. What is the marginal product of the second worker? a. 250 units b. 200 units c. 150 units d. 50 units
____ 77. On a 100-acre farm, a farmer is able to produce 3,000 bushels of wheat when he hires 2 workers. He is able to produce 4,400 bushels of wheat when he hires 3 workers. Which of the following possibilities is consistent with the property of diminishing marginal product? a. The farmer is able to produce 5,600 bushels of wheat when he hires 4 workers. b. The farmer is able to produce 5,800 bushels of wheat when he hires 4 workers. c. The farmer is able to produce 6,000 bushels of wheat when he hires 4 workers. d. Any of the above could be correct.
____ 78. On a 100-acre farm, a farmer is able to produce 3,000 bushels of wheat when he hires 2 workers. He is able to produce 4,400 bushels of wheat when he hires 3 workers. Which of the following possibilities is consistent with the property of diminishing marginal product? a. The farmer is able to produce 5,600 bushels of wheat when he hires 4 workers. b. The farmer is able to produce 5,400 bushels of wheat when he hires 4 workers. c. The farmer is able to produce 5,200 bushels of wheat when he hires 4 workers. d. Any of the above could be correct.
Table 13-6 Wooden Chair Factory
Number
of Workers
Number
of Machines
Output (chairs
produced per hour)
Marginal
Product of Labor
Cost of Workers
Cost of Machines
Total Cost
1 2 5 2 2 10 3 2 20 4 2 35 5 2 55 6 2 70 7 2 80
____ 79. Refer to Table 13-6. Each worker at the Wooden Chair Factory costs $12 per hour. The cost of each machine
is $20 per day regardless of the number of chairs produced. If the factory produces at a rate of 70 chairs per hour and operates 8 hours per day, what is the factory’s total labor cost per day? a. $72 b. $112 c. $576 d. $616
____ 80. Refer to Table 13-6. Each worker at the Wooden Chair Factory costs $12 per hour. The cost of each machine is $20 per day regardless of the number of chairs produced. What is the total daily cost of producing at a rate of 55 chairs per hour if the factory operates 8 hours per day?
a. $480 b. $576 c. $520 d. $616
____ 81. Refer to Table 13-6. Each worker at the Wooden Chair Factory costs $12 per hour. The cost of each machine is $20 per day regardless of the number of chairs produced. If the factory produces at a rate of 35 chairs per hour, what is the total labor cost per hour? a. $40 b. $48 c. $384 d. $424
Figure 13-3
2 4 6 8 10 12 14 16 Quantity
10
20
30
40
50
60
70
80
90
100Cost
____ 82. Refer to Figure 13-3. The graph illustrates a typical
a. total-cost curve. b. production function. c. production possibilities frontier. d. fixed-cost curve.
Scenario 13-13 Joan grows pumpkins. If Joan plants no seeds on her farm, she gets no harvest. If she plants 1 bag of seeds, she gets 500 pumpkins. If she plants 2 bags, she gets 800 pumpkins. If she plants 3 bags, she gets 900 pumpkins. A bag of seeds costs $100, and seeds are her only cost.
____ 83. Refer to Scenario 13-13. Joan’s production function exhibits
a. increasing marginal product. b. decreasing marginal product. c. constant marginal product. d. Any of the above could be correct.
Table 13-7 The Flying Elvis Copter Rides Quantity Total Fixed Variable Marginal Average Average Average
Cost Cost Cost Cost Fixed Cost
Variable Cost
Total Cost
0 $50 $50 $0 -- -- -- -- 1 $150 A B C D E F 2 G H I $120 J K L 3 M N O P Q $120 R
____ 84. Refer to Table 13-7. What is the value of A?
a. $25 b. $50 c. $100 d. $200
____ 85. Refer to Table 13-7. What is the value of B? a. $25 b. $50 c. $100 d. $200
____ 86. Refer to Table 13-7. What is the value of D? a. $25 b. $50 c. $100 d. $200
____ 87. Refer to Table 13-7. What is the value of E? a. $25 b. $50 c. $100 d. $150
Table 13-9
Measures of Cost for Very Brady Poster Factory Quantity of Posters
Variable Costs
Total Costs
Fixed Costs
0 $10 1 $ 1 2 $ 3 $13 3 $ 6 $16 4 $10 5 $25 6 $21 $10
____ 88. Refer to Table 13-9. The total cost of producing 1 poster is
a. $1.00. b. $10.00. c. $11.00. d. $22.00.
____ 89. Refer to Table 13-9. The marginal cost of producing the 6th poster is a. $1.00.
b. $3.50. c. $5.00. d. $6.00.
Table 13-10 Eileen’s Elegant Earrings produces pairs of earrings for its mail order catalogue business. Each pair is shipped in a separate box. She rents a small room for $150 a week in the downtown business district that serves as her factory. She can hire workers for $275 a week. There are no implicit costs.
Number of Workers
Boxes of Earrings
Produced per Week
Marginal Product of Labor
Cost of Factory
Cost
of Workers
Total Cost
of Inputs
0 0 1 330 $150 $275 $425 2 630 3 150 $825 $975 4 890 5 950 60 $1,375 6 10 $1,800
____ 90. Refer to Table 13-10. What is the total cost associated with making 890 boxes of earrings per week?
a. $1,250 b. $1,325 c. $1,400 d. $1,575
____ 91. Refer to Table 13-10. During the week of July 4th, Eileen doesn't produce any earrings. What are her costs during the week? a. $0 b. $150 c. $275 d. $425
Table 13-11 Teacher's Helper is a small company that has a subcontract to produce instructional materials for disabled children in public school districts. The owner rents several small rooms in an office building in the suburbs for $600 a month and has leased computer equipment that costs $480 a month.
Output (Instructional
Modules per Month)
Fixed Costs
Variable Costs
Total Cost
Average
Fixed Cost
Average Variable
Cost
Average
Total Cost
Marginal Cost
0 $1,080 1 $1,080 $ 400 $1,480 $400 2 $965 $450 3 $1,350 $2,430 4 $1,900 $475 5 $2,500 $216 6 $4,280 $700 7 $4,100
8 $5,400 $135 9 $7,300 10 $10,880 $980
____ 92. Refer to Table 13-11. What is the average variable cost for the month if 6 instructional modules are
produced? a. $180.00 b. $533.33 c. $700.00 d. $713.33
____ 93. Refer to Table 13-11. What is the average fixed cost for the month if 9 instructional modules are produced? a. $108.00 b. $120.00 c. $150.00 d. $811.11
Figure 13-4
A
A
D
DB
B
C C
Output
MC
____ 94. Refer to Figure 13-4. Which of the above marginal cost curves reflects diminishing marginal product?
a. A b. B c. C d. D
Scenario 13-17 Suppose that a given firm experiences decreasing marginal product of labor with the addition of each worker regardless of the current output level.
____ 95. Refer to Scenario 13-17. Average fixed cost will be
a. rising at all points. b. falling at all points. c. U-shaped. d. constant.
Figure 13-5
A
B
C
D
1 2 3 4 5 6 7 8 9 10 11 12 Quantity
1
2
3
4
5
6
7
8
9
10
11
Cost
____ 96. Refer to Figure 13-5. Curve A represents which type of cost curve?
a. marginal cost b. average total cost c. average variable cost d. average fixed cost
____ 97. Refer to Figure 13-5. Which of the curves is most likely to represent average fixed cost? a. A b. B c. C d. D
____ 98. Refer to Figure 13-5. Curve C represents which type of cost curve? a. marginal cost b. average total cost c. average variable cost d. average fixed cost
____ 99. Refer to Figure 13-5. Which curve is most likely to represent average total cost? a. A b. B c. C d. D
____ 100. Refer to Figure 13-5. Curve D represents which type of cost curve? a. marginal cost b. average total cost c. average variable cost d. average fixed cost
Figure 13-7
____ 101. Refer to Figure 13-7. Which of the figures represents the marginal cost curve for a typical firm?
a. Figure 1 b. Figure 2 c. Figure 3 d. Figure 4
____ 102. Refer to Figure 13-7. Which of the figures represents the production function for a typical firm? a. Figure 1 b. Figure 2 c. Figure 3 d. Figure 4
Figure 13-8
CA D
MC
ATC
AVC
B Quantity
Cost
____ 103. Refer to Figure 13-8. Quantity C represents the output level where the firm
a. maximizes profits. b. minimizes total costs. c. produces at the efficient scale. d. minimizes marginal costs.
____ 104. Refer to Figure 13-8. Quantity B represents the output level where the firm a. maximizes profits. b. minimizes average variable costs. c. produces at the efficient scale. d. minimizes marginal costs.
____ 105. Which of the following factors is most likely to shift IBM's total cost and marginal cost curves downward?
a. a technological advance resulting in increased productivity b. higher property taxes charged by the municipal government c. increased wages to attract additional computer operators d. a reduction in subsidies from the state government
____ 106. If marginal cost is equal to average total cost, then a. marginal cost is minimized. b. average total cost is minimized. c. average variable cost is minimized. d. marginal cost is zero.
____ 107. Which of the following statements is correct? a. If marginal cost is rising, then average total cost is rising. b. If marginal cost is rising, then average variable cost is rising. c. If average variable cost is rising, then marginal cost is minimized. d. If average total cost is rising, then marginal cost is greater than average total cost.
____ 108. The efficient scale of the firm is the quantity of output that a. maximizes marginal product. b. maximizes profit. c. minimizes average total cost. d. minimizes average variable cost.
____ 109. The firm's efficient scale is the quantity of output that minimizes a. average total cost. b. average fixed cost. c. average variable cost. d. marginal cost.
Figure 13-9 The figure below depicts average total cost functions for a firm that produces automobiles.
____ 110. Refer to Figure 13-9. Which of the curves is most likely to characterize the short-run average total cost curve
of the smallest factory?
a. ATCA b. ATCB c. ATCC d. ATCD
____ 111. Refer to Figure 13-9. Which curve represents the long-run average total cost? a. ATCA b. ATCB c. ATCC d. ATCD
____ 112. Refer to Figure 13-9. In the long run, the firm can operate on which of the following average total cost curves? a. ATCA b. ATCB c. ATCC d. All of the above are correct.
____ 113. Refer to Figure 13-9. The firm experiences economies of scale at which output levels? a. output levels less than M b. output levels between M and N c. output levels greater than N d. All of the above are correct as long as the firm is operating in the long run.
____ 114. Refer to Figure 13-9. At levels of output less than M, the firm experiences a. economies of scale. b. diseconomies of scale. c. constant returns to scale. d. both diminishing marginal productivity and coordination problems.
____ 115. Refer to Figure 13-9. The firm experiences constant returns to scale at which output levels? a. output levels less than M b. output levels between M and N c. output levels greater than N d. All of the above are correct as long as the firm is operating in the long run.
Figure 13-10
____ 116. Refer to Figure 13-10. The firm experiences economies of scale if it changes its level of output from
a. Q1 to Q2. b. Q2 to Q3. c. Q3 to Q4. d. Q4 to Q5.
____ 117. Refer to Figure 13-10. The firm experiences constant returns to scale if it changes its level of output from a. Q1 to Q2. b. Q2 to Q4. c. Q1 to Q3. d. Q4 to Q5.
____ 118. Refer to Figure 13-10. The firm experiences diseconomies of scale if it changes its level of output from a. Q1 to Q2. b. Q2 to Q3. c. Q3 to Q4. d. Q4 to Q5.
Review Questions for Midterm-1 Answer Section
MULTIPLE CHOICE
1. ANS: A PTS: 1 DIF: 2 REF: 4-2
NAT: Analytic LOC: Supply and demand TOP: Quantity demanded MSC: Interpretive
2. ANS: D PTS: 1 DIF: 2 REF: 4-2 NAT: Analytic LOC: Supply and demand TOP: Market demand MSC: Analytical
3. ANS: B PTS: 1 DIF: 2 REF: 4-2 NAT: Analytic LOC: Supply and demand TOP: Market demand MSC: Analytical
4. ANS: C PTS: 1 DIF: 2 REF: 4-2 NAT: Analytic LOC: Supply and demand TOP: Demand curve MSC: Applicative
5. ANS: A PTS: 1 DIF: 2 REF: 4-2 NAT: Analytic LOC: Supply and demand TOP: Demand curve MSC: Applicative
6. ANS: A PTS: 1 DIF: 1 REF: 4-2 NAT: Analytic LOC: Supply and demand TOP: Substitutes MSC: Definitional
7. ANS: D PTS: 1 DIF: 1 REF: 4-2 NAT: Analytic LOC: Supply and demand TOP: Complements MSC: Definitional
8. ANS: D PTS: 1 DIF: 2 REF: 4-2 NAT: Analytic LOC: Supply and demand TOP: Demand curve MSC: Applicative
9. ANS: C PTS: 1 DIF: 2 REF: 4-4 NAT: Analytic LOC: Supply and demand TOP: Equilibrium MSC: Applicative
10. ANS: D PTS: 1 DIF: 2 REF: 4-4 NAT: Analytic LOC: Supply and demand TOP: Equilibrium | Market demand MSC: Applicative
11. ANS: C PTS: 1 DIF: 2 REF: 4-4 NAT: Analytic LOC: Supply and demand TOP: Equilibrium MSC: Applicative
12. ANS: B PTS: 1 DIF: 2 REF: 4-4 NAT: Analytic LOC: Supply and demand TOP: Equilibrium MSC: Applicative
13. ANS: B PTS: 1 DIF: 2 REF: 4-4 NAT: Analytic LOC: Supply and demand TOP: Equilibrium | Complements MSC: Applicative
14. ANS: A PTS: 1 DIF: 2 REF: 4-4 NAT: Analytic LOC: Supply and demand TOP: Demand | Quantity supplied MSC: Applicative
15. ANS: A PTS: 1 DIF: 2 REF: 4-4
NAT: Analytic LOC: Supply and demand TOP: Demand | Quantity supplied MSC: Applicative
16. ANS: D PTS: 1 DIF: 1 REF: 5-0 NAT: Analytic LOC: Elasticity TOP: Elasticity MSC: Definitional
17. ANS: A PTS: 1 DIF: 2 REF: 5-0 NAT: Analytic LOC: Elasticity TOP: Elasticity MSC: Applicative
18. ANS: B PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Price elasticity of demand MSC: Interpretive
19. ANS: D PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Price elasticity of demand MSC: Interpretive
20. ANS: C PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Price elasticity of demand MSC: Applicative
21. ANS: C PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Price elasticity of demand MSC: Applicative
22. ANS: B PTS: 1 DIF: 1 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Price elasticity of demand MSC: Applicative
23. ANS: A PTS: 1 DIF: 1 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Price elasticity of demand MSC: Applicative
24. ANS: B PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Price elasticity of demand MSC: Applicative
25. ANS: B PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Price elasticity of demand MSC: Applicative
26. ANS: B PTS: 1 DIF: 1 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Perfectly elastic demand MSC: Interpretive
27. ANS: D PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Perfectly inelastic demand MSC: Interpretive
28. ANS: A PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Price elasticity of demand MSC: Applicative
29. ANS: C PTS: 1 DIF: 3 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Total revenue | Price elasticity of demand MSC: Applicative
30. ANS: C PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Total revenue | Price elasticity of demand MSC: Interpretive
31. ANS: D PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Total revenue | Price elasticity of demand MSC: Interpretive
32. ANS: D PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Total revenue | Price elasticity of demand MSC: Interpretive
33. ANS: A PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Total revenue | Price elasticity of demand MSC: Interpretive
34. ANS: D PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Total revenue | Price elasticity of demand MSC: Applicative
35. ANS: B PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Price elasticity of demand MSC: Interpretive
36. ANS: C PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Price elasticity of demand MSC: Applicative
37. ANS: A PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Midpoint method | Price elasticity of demand MSC: Applicative
38. ANS: A PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Total revenue | Price elasticity of demand MSC: Applicative
39. ANS: B PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Total revenue | Price elasticity of demand MSC: Applicative
40. ANS: D PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Income elasticity of demand | Midpoint method MSC: Applicative
41. ANS: D PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Income elasticity of demand MSC: Interpretive
42. ANS: C PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Income elasticity of demand MSC: Interpretive
43. ANS: A PTS: 1 DIF: 1 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Income elasticity of demand MSC: Interpretive
44. ANS: B PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Income elasticity of demand MSC: Interpretive
45. ANS: A PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Cross-price elasticity of demand MSC: Applicative
46. ANS: B PTS: 1 DIF: 1 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Cross-price elasticity of demand MSC: Definitional
47. ANS: B PTS: 1 DIF: 2 REF: 5-1 NAT: Analytic LOC: Elasticity TOP: Cross-price elasticity of demand MSC: Interpretive
48. ANS: B PTS: 1 DIF: 2 REF: 5-1
NAT: Analytic LOC: Elasticity TOP: Cross-price elasticity of demand MSC: Interpretive
49. ANS: C PTS: 1 DIF: 1 REF: 5-2 NAT: Analytic LOC: Elasticity TOP: Price elasticity of supply MSC: Definitional
50. ANS: C PTS: 1 DIF: 2 REF: 5-2 NAT: Analytic LOC: Elasticity TOP: Price elasticity of supply MSC: Interpretive
51. ANS: C PTS: 1 DIF: 2 REF: 5-2 NAT: Analytic LOC: Elasticity TOP: Price elasticity of supply MSC: Analytical
52. ANS: C PTS: 1 DIF: 2 REF: 5-2 NAT: Analytic LOC: Elasticity TOP: Price elasticity of supply MSC: Analytical
53. ANS: C PTS: 1 DIF: 2 REF: 5-2 NAT: Analytic LOC: Elasticity TOP: Price elasticity of supply MSC: Analytical
54. ANS: B PTS: 1 DIF: 1 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Profit maximization MSC: Interpretive
55. ANS: A PTS: 1 DIF: 1 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Total revenue MSC: Definitional
56. ANS: B PTS: 1 DIF: 2 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Total revenue MSC: Applicative
57. ANS: C PTS: 1 DIF: 1 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Total revenue MSC: Applicative
58. ANS: C PTS: 1 DIF: 2 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Total cost MSC: Definitional
59. ANS: B PTS: 1 DIF: 1 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Profit MSC: Definitional
60. ANS: A PTS: 1 DIF: 2 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Profit MSC: Applicative
61. ANS: B PTS: 1 DIF: 1 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Opportunity cost MSC: Interpretive
62. ANS: C PTS: 1 DIF: 3 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Opportunity cost MSC: Analytical
63. ANS: C PTS: 1 DIF: 2 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Opportunity cost MSC: Analytical
64. ANS: C PTS: 1 DIF: 2 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Opportunity cost
MSC: Analytical
65. ANS: A PTS: 1 DIF: 1 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Explicit costs MSC: Definitional
66. ANS: C PTS: 1 DIF: 2 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Implicit costs MSC: Interpretive
67. ANS: C PTS: 1 DIF: 3 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Economic profit | Accounting profit MSC: Applicative
68. ANS: A PTS: 1 DIF: 2 REF: 13-1 NAT: Analytic LOC: Costs of production TOP: Economic profit | Accounting profit MSC: Analytical
69. ANS: A PTS: 1 DIF: 1 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Production function MSC: Definitional
70. ANS: B PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Production function MSC: Analytical
71. ANS: D PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Production function MSC: Analytical
72. ANS: D PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Marginal product MSC: Definitional
73. ANS: C PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Marginal product MSC: Analytical
74. ANS: D PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Marginal product MSC: Analytical
75. ANS: B PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Marginal product MSC: Analytical
76. ANS: A PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Marginal product MSC: Analytical
77. ANS: A PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Diminishing marginal product MSC: Analytical
78. ANS: D PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Diminishing marginal product MSC: Analytical
79. ANS: C PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Variable costs MSC: Applicative
80. ANS: C PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Total cost MSC: Applicative
81. ANS: B PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Variable costs MSC: Applicative
82. ANS: A PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Total-cost curve MSC: Interpretive
83. ANS: B PTS: 1 DIF: 2 REF: 13-2 NAT: Analytic LOC: Costs of production TOP: Diminishing marginal product MSC: Analytical
84. ANS: B PTS: 1 DIF: 1 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Fixed costs MSC: Analytical
85. ANS: C PTS: 1 DIF: 1 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Variable costs MSC: Analytical
86. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Average fixed cost MSC: Analytical
87. ANS: C PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Average variable cost MSC: Analytical
88. ANS: C PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Total cost MSC: Applicative
89. ANS: D PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Marginal cost MSC: Applicative
90. ANS: A PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Total cost MSC: Applicative
91. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Fixed costs MSC: Applicative
92. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Average variable cost MSC: Applicative
93. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Average fixed cost MSC: Applicative
94. ANS: A PTS: 1 DIF: 3 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Marginal-cost curve | Diminishing marginal product MSC: Analytical
95. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves | Average fixed cost MSC: Analytical
96. ANS: D PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves | Average fixed cost MSC: Interpretive
97. ANS: A PTS: 1 DIF: 2 REF: 13-3
NAT: Analytic LOC: Costs of production TOP: Cost curves | Average fixed cost MSC: Interpretive
98. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves | Average total cost MSC: Interpretive
99. ANS: C PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves | Average total cost MSC: Interpretive
100. ANS: A PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves | Marginal cost MSC: Interpretive
101. ANS: A PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves | Marginal cost MSC: Analytical
102. ANS: D PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Production function MSC: Analytical
103. ANS: C PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Efficient scale MSC: Analytical
104. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves | Average variable cost MSC: Analytical
105. ANS: A PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves MSC: Analytical
106. ANS: B PTS: 1 DIF: 2 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves MSC: Interpretive
107. ANS: D PTS: 1 DIF: 3 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Cost curves MSC: Interpretive
108. ANS: C PTS: 1 DIF: 1 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Efficient scale MSC: Definitional
109. ANS: A PTS: 1 DIF: 1 REF: 13-3 NAT: Analytic LOC: Costs of production TOP: Efficient scale MSC: Definitional
110. ANS: A PTS: 1 DIF: 1 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Average total cost MSC: Analytical
111. ANS: D PTS: 1 DIF: 1 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Average total cost MSC: Analytical
112. ANS: D PTS: 1 DIF: 1 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Average total cost MSC: Analytical
113. ANS: A PTS: 1 DIF: 2 REF: 13-4
NAT: Analytic LOC: Costs of production TOP: Economies of scale MSC: Analytical
114. ANS: A PTS: 1 DIF: 2 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Economies of scale MSC: Analytical
115. ANS: B PTS: 1 DIF: 2 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Constant returns to scale MSC: Analytical
116. ANS: A PTS: 1 DIF: 2 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Economies of scale MSC: Analytical
117. ANS: B PTS: 1 DIF: 2 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Constant returns to scale MSC: Analytical
118. ANS: D PTS: 1 DIF: 2 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Diseconomies of scale MSC: Analytical