Question 1

Total revenue minus only explicit costs is called

Accepted Answer

A)  accounting profit.
B)  economic profit.
C)  average total cost.
D)  implicit profit.E) A) and B)
F) A) and C)

Question 2

Table 13-7
The Flying Elvis Copter Rides 
-Refer to Table 13-7. What is the value of N?

Accepted Answer

A)  $50
B)  $140
C)  $360
D)  $410E) None of the above
F) A) and B)

Question 3

Table 13-11 
-Refer to Table 13-11. What is the variable cost of producing 5 posters?

Accepted Answer

A)  $13
B)  $14
C)  $15
D)  It can't be determined from the information given.E) A) and C)
F) A) and B)

Question 4

Consider a small hair styling salon. List some examples of implicit costs of this business.

Accepted Answer

the lost earnings of the owner...

Question 5

In the long run a company that produces and sells popcorn incurs total costs of $1,050 when output is 90 canisters and $1,200 when output is 120 canisters. The popcorn company exhibits

Accepted Answer

A)  diseconomies of scale because total cost is rising as output rises.
B)  diseconomies of scale because average total cost is rising as output rises.
C)  economies of scale because total cost is rising as output rises.
D)  economies of scale because average total cost is falling as output rises.E) None of the above
F) A) and B)

Question 6

The Wacky Widget company has total fixed costs of $100,000 per year. The firm's average variable cost is $5 for 10,000 widgets. At that level of output, the firm's average total costs equal

Accepted Answer

A)  $10
B)  $15
C)  $100
D)  $150E) B) and D)
F) A) and D)

Question 7

In the long run, a firm that produces and sells textbooks gets to choose

Accepted Answer

A)  how many workers to hire.
B)  the size of its factories.
C)  which short-run average-total-cost curve to use.
D)  All of the above are correct.E) B) and C)
F) C) and D)

Question 8

Bubba is a shrimp fisherman who could earn $5,000 as a fishing tour guide. Instead, he is a full-time shrimp fisherman. In calculating the economic profit of his shrimp business, the $5,000 that Bubba gave up is counted as part of the shrimp business's

Accepted Answer

A)  total revenue.
B)  explicit costs.
C)  implicit costs.
D)  marginal costs.E) None of the above
F) All of the above

Question 9

The average-fixed-cost curve

Accepted Answer

A)  is constant.
B)  is always decreasing.
C)  intersects marginal cost at the minimum of average fixed cost.
D)  intersects marginal cost at the minimum of marginal cost.E) None of the above
F) All of the above

Question 10

Suppose a certain firm is able to produce 165 units of output per day when 15 workers are hired. The firm is able to produce 181 units of output per day when 16 workers are hired, holding other inputs fixed. The marginal product of the 16th worker is

Accepted Answer

A)  10 units of output.
B)  11 units of output.
C)  16 units of output.
D)  181 units of output.E) C) and D)
F) A) and D)

Question 11

Some costs do not vary with the quantity of output produced. Those costs are called

Accepted Answer

A)  marginal costs.
B)  average costs.
C)  fixed costs.
D)  explicit costs.E) A) and B)
F) A) and D)

Question 12

Total cost can be divided into two types of costs:

Accepted Answer

A)  fixed costs and variable costs.
B)  fixed costs and marginal costs.
C)  variable costs and marginal costs.
D)  average costs and marginal costs.E) A) and D)
F) C) and D)

Question 13

Fixed costs are those costs that remain fixed no matter how long the time horizon is.

Accepted Answer

A) True 
 B)False

Question 14

If the average-total-cost of producing five units is $10, and the marginal-cost of producing the fifth unit is $10, then the average-total-cost curve is at its minimum at five units.​

Accepted Answer

A) True 
 B)False

Question 15

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

Accepted Answer

A)  (ii)  and (iii)  only
B)  (i)  and (iii)  only
C)  (i)  only
D)  (iii)  onlyE) A) and D)
F) None of the above

Question 16

If Kevin's children run a lemonade stand for a day and sell 200 glasses of lemonade at $0.50 each, their total revenues are

Accepted Answer

A)  $100.
B)  $199.50.
C)  $200.
D)  $400.E) B) and C)
F) B) and D)

Question 17

If long-run average total cost is rising, then the firm is experiencing economies of scale.

Accepted Answer

A) True 
 B)False

Question 18

The average-fixed-cost curve is constant.

Accepted Answer

A) True 
 B)False

Question 19

Suppose that for a particular firm the only variable input into the production process is labor and that output equals zero when no workers are hired. In addition, suppose that marginal cost of the third worker hired is $40, and the average total cost when three workers are hired is $50. What is the total cost of production when three workers are hired?

Accepted Answer

A)  $50
B)  $90
C)  $120
D)  $150E) A) and C)
F) A) and B)

Question 20

Katya owns a math-tutoring business. Her accountant most likely includes which of the following costs on her financial statements? (i) 
Workbooks containing practice problems
(ii) 
Rent for the storefront
(iii) 
Wages Katya could earn as a bookkeeper
(iv) 
Interest that Katya's money was earning before she spent her savings to set up the tutoring business

Accepted Answer

A)  (i)  only
B)  (i)  and (ii)  only
C)  (iii)  and (iv)  only
D)  (i) , (ii) , (iii) , and (iv) E) B) and C)
F) A) and B)

Exam 13: The Costs of Production

If Kevin's children run a lemonade stand for a day and sell 200 glasses of lemonade at $0.50 each, their total revenues are

Correct Answer
verified

The average-fixed-cost curve is constant.

Correct Answer
verified

Table 13-7 The Flying Elvis Copter Rides -Refer to Table 13-7. What is the value of N?

Correct Answer
verified

Bubba is a shrimp fisherman who could earn $5,000 as a fishing tour guide. Instead, he is a full-time shrimp fisherman. In calculating the economic profit of his shrimp business, the $5,000 that Bubba gave up is counted as part of the shrimp business's

Correct Answer
verified

In the long run a company that produces and sells popcorn incurs total costs of $1,050 when output is 90 canisters and $1,200 when output is 120 canisters. The popcorn company exhibits

Correct Answer
verified

Some costs do not vary with the quantity of output produced. Those costs are called

Correct Answer
verified

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

Correct Answer
verified

Consider a small hair styling salon. List some examples of implicit costs of this business.

Correct Answer
verified
the lost earnings of the owner...
View Answer

The Wacky Widget company has total fixed costs of $100,000 per year. The firm's average variable cost is $5 for 10,000 widgets. At that level of output, the firm's average total costs equal

Correct Answer
verified

The average-fixed-cost curve

Correct Answer
verified

Total cost can be divided into two types of costs:

Correct Answer
verified

If the average-total-cost of producing five units is $10, and the marginal-cost of producing the fifth unit is $10, then the average-total-cost curve is at its minimum at five units.

Correct Answer
verified

Correct Answer
verified

Fixed costs are those costs that remain fixed no matter how long the time horizon is.

Correct Answer
verified

In the long run, a firm that produces and sells textbooks gets to choose

Correct Answer
verified

Table 13-11 -Refer to Table 13-11. What is the variable cost of producing 5 posters?

Correct Answer
verified

Correct Answer
verified

If long-run average total cost is rising, then the firm is experiencing economies of scale.

Correct Answer
verified

Total revenue minus only explicit costs is called

Correct Answer
verified

Suppose a certain firm is able to produce 165 units of output per day when 15 workers are hired. The firm is able to produce 181 units of output per day when 16 workers are hired, holding other inputs fixed. The marginal product of the 16th worker is

Correct Answer
verified

Exam 13: The Costs of Production

If Kevin's children run a lemonade stand for a day and sell 200 glasses of lemonade at $0.50 each, their total revenues are

Correct AnswerverifiedShow Answer

The average-fixed-cost curve is constant.

Correct AnswerverifiedShow Answer

Table 13-7 The Flying Elvis Copter Rides -Refer to Table 13-7. What is the value of N?

Correct AnswerverifiedShow Answer

Bubba is a shrimp fisherman who could earn $5,000 as a fishing tour guide. Instead, he is a full-time shrimp fisherman. In calculating the economic profit of his shrimp business, the $5,000 that Bubba gave up is counted as part of the shrimp business's

Correct AnswerverifiedShow Answer

In the long run a company that produces and sells popcorn incurs total costs of $1,050 when output is 90 canisters and $1,200 when output is 120 canisters. The popcorn company exhibits

Correct AnswerverifiedShow Answer

Some costs do not vary with the quantity of output produced. Those costs are called

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Consider a small hair styling salon. List some examples of implicit costs of this business.

Correct Answerverifiedthe lost earnings of the owner...View AnswerShow Answer

The Wacky Widget company has total fixed costs of $100,000 per year. The firm's average variable cost is $5 for 10,000 widgets. At that level of output, the firm's average total costs equal

Correct AnswerverifiedShow Answer

The average-fixed-cost curve

Correct AnswerverifiedShow Answer

Total cost can be divided into two types of costs:

Correct AnswerverifiedShow Answer

If the average-total-cost of producing five units is $10, and the marginal-cost of producing the fifth unit is $10, then the average-total-cost curve is at its minimum at five units.​

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Fixed costs are those costs that remain fixed no matter how long the time horizon is.

Correct AnswerverifiedShow Answer

In the long run, a firm that produces and sells textbooks gets to choose

Correct AnswerverifiedShow Answer

Table 13-11 -Refer to Table 13-11. What is the variable cost of producing 5 posters?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If long-run average total cost is rising, then the firm is experiencing economies of scale.

Correct AnswerverifiedShow Answer

Total revenue minus only explicit costs is called

Correct AnswerverifiedShow Answer

Suppose a certain firm is able to produce 165 units of output per day when 15 workers are hired. The firm is able to produce 181 units of output per day when 16 workers are hired, holding other inputs fixed. The marginal product of the 16th worker is

Correct AnswerverifiedShow Answer

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the lost earnings of the owner...
View Answer

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Correct Answer
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Correct Answer
verified

If the average-total-cost of producing five units is $10, and the marginal-cost of producing the fifth unit is $10, then the average-total-cost curve is at its minimum at five units.

Correct Answer
verified

Correct Answer
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