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A firm's total fixed cost is $100. If total cost is $200 for one unit of output and $310 for two units, what is the marginal cost of the second unit?
$110
0%
$100
0%
$200
0%
$310
0%
$210
0%
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If energy (E) is the only input used to produce output (Q), what is the formula for average product of energy?
ΔQ/ΔE
0%
ΔE/ΔQ
0%
E/Q
0%
Q ∗ E
0%
Q/E
100%
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The short run is a time frame in which
at least one factor of production is fixed.
0%
the firm is not able to hire more workers.
0%
the amount of output produced is fixed.
0%
there is a shortage of most factors of production.
0%
there is not enough time to make all of the decisions necessary to maximize profit.
0%
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Which of the following statements by a restaurant owner refers to the law of diminishing returns?
"We can serve the same number of meals with less kitchen equipment, but we would have to hire more kitchen staff."
0%
"We can serve the same number of meals with fewer kitchen staff, but we would have to buy more labour-saving kitchen equipment."
0%
"We can increase the number of meals we serve by just adding more kitchen staff, but each additional worker adds less meals than the previous worker because traffic in the kitchen will get worse."
100%
"If we double the size of our premises and double everything else — kitchen staff, serving staff, equipment — we can increase the number of meals we serve, but not to double the current levels."
0%
"The higher the quality of the ingredients we use, the higher the cost of producing each meal."
0%
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The vertical distance between the
TC
and
TVC
curves
is equal to
MC
.
0%
is equal to
AFC
.
0%
is equal to
TFC.
100%
increases as output increases.
0%
decreases as output increases.
0%
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For a firm, what is the relationship between the quantity of input and quantity of output called?
None of the above.
❌
the production function
✅
the quantity function
❌
the total-cost function
❌
the profit function
❌
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The law of diminishing marginal returns refers to the tendency for the ________ to eventually decrease as more labour is employed, everything else remaining the same.
marginal product of labour
✅
average total cost
❌
marginal cost
❌
total product
❌
average product of labour
❌
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A firm experiences ________ when its ________ as output increases.
constant returns to scale; long-run average cost curve shifts upward
❌
diminishing marginal returns; average total cost curve shifts upward
❌
economies of scale; long-run average cost curve slopes downward
✅
diseconomies of scale; average total cost curve slopes downward
❌
economies of scale; long-run average cost curve shifts upward
❌
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One reason for diseconomies of scale is that as output becomes larger and larger,
workers become more efficient.
0%
management systems can become more complex and inefficient.
0%
management systems become more efficient.
0%
costs per unit decrease.
0%
the number of workers increases.
0%
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The marginal product of labour
is less than the average product of labour when the average product of labour is decreasing.
0%
measures how output changes as the wage rate changes.
0%
is negative when adding another unit of labour decreases output.
0%
both b and c
100%
both a and b
0%
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