Personal tools
  •  
You are here: Home Economics Introduction to Microeconomics Assignment 5

Assignment 5

Document Actions
  • Content View
  • Bookmarks
  • CourseFeed
Question 1 (1 point)
Total physical product
  1. is always increasing as an input is increased.
  2. explains why the demand curve is downward sloping.
  3. is only relevant in the long run.
  4. is the maximum output that can be produced from different quantities of a resource.
  5. is identical to average physical product.
Question 2 (1 point)
Suppose that four workers can harvest 20 bushels of corn on an acre of land per day, while five workers can harvest 25 bushels. Then
  1. the marginal physical product of the fourth worker is 5 and the average physical product of five workers is 20.
  2. marginal and average physical products cannot be determined from the information provided.
  3. the marginal physical product of the fifth worker is 5 and the average physical product of five workers is 5.
  4. the marginal physical product of the fifth worker is 25 and the average physical product of five workers is 20.
  5. the marginal physical product of the fourth worker is 5 and the average physical product of 4 workers is 5.
Question 3 (1 point)
The fourth air bag in an automobile is less effective in providing safety for the passengers of the automobile than the second air bag. The reason for this is
  1. consumers don't demand it.
  2. inadequate government safety regulations.
  3. the law of diminishing marginal returns.
  4. the law of increasing marginal returns.
  5. irresponsible behavior by automobile manufacturers.
Question 4 (1 point)
Assume that one laborer produces 6 units of output, two laborers produce 14 units, three laborers 20 units, and four laborers 24 units. Diminishing returns set in when the firm hires
  1. the first laborer.
  2. the second laborer.
  3. the third laborer.
  4. the fourth laborer.
  5. Diminishing returns have not set in; total product is still increasing.
Question 5 (1 point)
Labor vs Quantity
In the figure above, the state of diminishing marginal returns is illustrated by
  1. curve Y for labor inputs beyond L 1
  2. curves X and Y when total product is decreasing.
  3. curve Y for labor inputs L 2 - L 4 only.
  4. curve X for labor inputs beyond L 3 only.
  5. curve Y for labor inputs L 1 - L 2 only.
Question 6 (1 point)
The sum of the prices which firms must pay for resources used in production times the quantity of resources used, for each quantity of output produced, is known as the firm's
  1. total cost schedule.
  2. total physical product schedule.
  3. total resource schedule.
  4. average physical product schedule
  5. average total cost schedule.
Question 7 (1 point)
Total costs are
  1. the costs of all variable resources.
  2. defined to be equal to the value of consumer surplus.
  3. the costs of variable and fixed resources.
  4. defined to be equal to dollars multiplied by the marginal physical product.
  5. the costs of all variable resources used to produce goods and services.
Question 8 (1 point)
If the total cost of producing two pounds of cheese is $6 and the total cost of producing four pounds of cheese is $8, then the average total cost of producing four pounds of cheese is equal to
  1. $0.50
  2. $1
  3. $2
  4. $4
  5. $8
Question 9 (1 point)
Suppose that the total cost of producing five sailboats is $8,000, and the total cost of producing six sailboats is $10,000. Then the marginal cost of the sixth sailboat is
  1. $10,000.
  2. $66.
  3. $1,600.
  4. $1,666.
  5. $2,000.
Question 10 (1 point)
The law of diminishing marginal returns causes the shape of the average-physical-product curve to be __________ and the shape of the average-total-cost curve to be __________ .
  1. U-shaped; U-shaped
  2. hump-shaped; U-shaped
  3. hump-shaped; hump-shaped
  4. U-shaped; hump-shaped
  5. a straight line; U-shaped
Question 11 (1 point)
Total fixed costs
  1. are constant as output increases.
  2. must be paid whether the firm produces or not.
  3. are the costs of fixed inputs for the firm
  4. equal total costs minus total variable costs.
  5. All of these.
Question 12 (1 point)
If the total cost of producing 6 units is $228 and the total cost of producing 7 units is $245, what is the marginal cost of producing the seventh unit?
  1. $3
  2. $35
  3. $245
  4. $38
  5. $17
Question 13 (1 point)
Quantity vs Price
In the figure above, the curve marked II is the firm's
  1. marginal-cost curve.
  2. total-cost curve.
  3. average-fixed-cost curve.
  4. average-variable-cost curve.
  5. average-total-cost curve.
Question 14 (1 point)
Quantity vs Price
In the figure above, average total cost reaches a minimum
  1. where average fixed cost = RS.
  2. at a quantity of T.
  3. where MC = ATC
  4. where average variable cost = ST.
  5. All of these.
Question 15 (1 point)
Average total cost will equal marginal cost when
  1. MC is declining.
  2. AFC is increasing.
  3. MC is at its lowest point.
  4. ATC is at its lowest point.
  5. ATC is zero.
Question 16 (1 point)
According to economic theory, the difference between the long run and the short run is
  1. strictly theoretical so that in practice there is no difference between the short run and the long run.
  2. the ability for a firm to vary all resources.
  3. not relevant for executive decision makers.
  4. about two months.
  5. about two years.
Question 17 (1 point)
The long-run average-total-cost curve shows
  1. the maximum cost combination of resources with which each level of output is produced when at least one resource is fixed.
  2. the lowest cost combination of resources with which each level of output is produced when at least one resource is fixed.
  3. the set of minimum points of each short-run average-total-cost curve.
  4. the lowest cost combination of resources with which each level of output is produced when all resources are variable.
  5. None of these.
Question 18 (1 point)
In the electricity generation industry, the cost per kilowatt hour of electricity declines as the capacity to generate output increases. This situation represents
  1. that electricity generation doesn't harm the environment.
  2. constant returns to scale.
  3. a poor opportunity for investors.
  4. diseconomies of scale.
  5. economies of scale.
Question 19 (1 point)
Quantity vs Cost
Refer to the figure above. Between quantity Q 1 and quantity Q 2
  1. the firm will not produce.
  2. diseconomies of scale outweigh the benefits of economies of scale.
  3. the firm's per unit costs increase as output remains constant.
  4. the firm experiences constant returns to scale.
  5. the firm benefits from economies of scale
Question 20 (1 point)
Which of the following would not be likely to result in diseconomies of scale?
  1. Low productivity
  2. Low worker morale
  3. Administration overhead
  4. Managerial problems
  5. Specialization of labor
Question 1 (5.00 points)
What is the relationship between marginal and average?
Question 2 (5.00 points)
Explain why the APP curve rises when MPP is greater than APP and falls when MPP is less than APP.
Copyright 2008, by the Contributing Authors. Cite/attribute Resource . admin. (2009, January 27). Assignment 5. Retrieved January 07, 2011, from Free Online Course Materials — USU OpenCourseWare Web site: http://ocw.usu.edu/economics/introduction-to-microeconomics-1/assignment5.htm. This work is licensed under a Creative Commons License Creative Commons License