Question 1

Table 13-12
Betty's Bakery
 
-Refer to Table 13-12.What is the total cost of producing 7 cakes at Betty's Bakery?

Accepted Answer

A)   $140
B)   $150
C)   $153
D)   $158E) None of the above
F) A) and C)

Question 2

Table 13-9
 
-Refer to Table 13-9.What is the marginal cost of producing the 1st poster?

Accepted Answer

A)   $1.00
B)   $10.00
C)   $11.00
D)   It can't be determined from the information given.E) A) and D)
F) B) and D)

Question 3

Table 13-2
 
-Refer to Table 13-2.What is the marginal product of the sixth worker?

Accepted Answer

Total output of four workers =...

Question 4

The Big Box corporation produced and sold 500 units of output.The average cost of production per unit was $50.Each unit sold for a price of $65.The Big Box corporation's total revenues are

Accepted Answer

A)   $7,500.
B)   $25,000.
C)   $32,500.
D)   $67,500.E) C) and D)
F) None of the above

Question 5

The typical total-cost curve is U-shaped.

Accepted Answer

A) True 
 B)False

Question 6

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

Accepted Answer

A)   $25
B)   $50
C)   $100
D)   $200E) B) and D)
F) B) and C)

Question 7

Marginal costs are costs that do not vary with the quantity of output produced.

Accepted Answer

A) True 
 B)False

Question 8

Table 13-13
 
-Refer to Table 13-13.What is variable cost when output equals 30 units?

Accepted Answer

A)   $4
B)   $40
C)   $90
D)   $130E) A) and C)
F) A) and B)

Question 9

Economies of scale often arise because higher production levels allow specialization among workers.

Accepted Answer

A) True 
 B)False

Question 10

Suppose that a worker can produce 100 units of output in 7 hours.In the 8th hour,he can produce 12 units of output.The worker can produce 112 units of output in 8 hours.

Accepted Answer

A) True 
 B)False

Question 11

Table 13-2
 
-Refer to Table 13-2.What is the shape of the firm's total-cost curve?

Accepted Answer

The firm's total-cost curve wo...

Question 12

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) A) and D)
F) All of the above

Question 13

Table 13-2
 
-Refer to Table 13-2.What is the marginal product of the third worker?

Accepted Answer

450 - 350 ...

Question 14

What are opportunity costs? How do explicit and implicit costs relate to opportunity costs?

Accepted Answer

The opportunity cost of an ite...

Question 15

The marginal product of an input in the production process is the increase in

Accepted Answer

A)   total revenue obtained from an additional unit of that input
B)   profit obtained from an additional unit of that input.
C)   total revenue obtained from an additional unit of that input.
D)   quantity of output obtained from an additional unit of that input.E) A) and C)
F) B) and C)

Question 16

Which of the following is an example of an implicit cost?

Accepted Answer

A)   salaries paid to owners who work for the firm
B)   interest on money borrowed to finance equipment purchases
C)   cash payments for raw materials
D)   foregone rent on office space owned and used by the firmE) All of the above
F) None of the above

Question 17

An example of an opportunity cost that is also an implicit cost is

Accepted Answer

A)   a lease payment.
B)   the cost of raw materials.
C)   the value of the business owner's time.
D)   All of the above are correct.E) B) and C)
F) B) and D)

Question 18

Tom's Tent Company has total fixed costs of $300,000 per year.The firm's average variable cost is $80 for 10,000 tents.At that level of output,the firm's average total costs equal

Accepted Answer

A)   $80
B)   $90
C)   $100
D)   $110E) B) and D)
F) None of the above

Question 19

Marginal cost equals

Accepted Answer

A)   total cost divided by quantity of output produced.
B)   total output divided by the change in total cost.
C)   the slope of the total cost curve.
D)   the slope of the line drawn from the origin to the total cost curve.E) C) and D)
F) A) and D)

Question 20

Table 13-6
Wooden Chair Factory
 
-Refer to Table 13-6.Assume the Wooden Chair Factory currently employs 2 workers.What is the marginal product of labor when the factory adds a 3rd worker?

Accepted Answer

A)   5 chairs per hour
B)   10 chairs per hour
C)   20 chairs per hour
D)   25 chairs per hourE) All of the above
F) A) and C)

Exam 13: The Costs of Production

Which of the following is an example of an implicit cost?

Correct AnswerverifiedShow Answer

Table 13-2 -Refer to Table 13-2.What is the marginal product of the third worker?

Correct Answerverified450 - 350 ...View AnswerShow 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

Tom's Tent Company has total fixed costs of $300,000 per year.The firm's average variable cost is $80 for 10,000 tents.At that level of output,the firm's average total costs equal

Correct AnswerverifiedShow Answer

Table 13-13 -Refer to Table 13-13.What is variable cost when output equals 30 units?

Correct AnswerverifiedShow Answer

The Big Box corporation produced and sold 500 units of output.The average cost of production per unit was $50.Each unit sold for a price of $65.The Big Box corporation's total revenues are

Correct AnswerverifiedShow Answer

Table 13-2 -Refer to Table 13-2.What is the marginal product of the sixth worker?

Correct AnswerverifiedTotal output of four workers =...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

Suppose that a worker can produce 100 units of output in 7 hours.In the 8th hour,he can produce 12 units of output.The worker can produce 112 units of output in 8 hours.

Correct AnswerverifiedShow Answer

An example of an opportunity cost that is also an implicit cost is

Correct AnswerverifiedShow Answer

Marginal cost equals

Correct AnswerverifiedShow Answer

The typical total-cost curve is U-shaped.

Correct AnswerverifiedShow Answer

Table 13-12 Betty's Bakery -Refer to Table 13-12.What is the total cost of producing 7 cakes at Betty's Bakery?

Correct AnswerverifiedShow Answer

Table 13-2 -Refer to Table 13-2.What is the shape of the firm's total-cost curve?

Correct AnswerverifiedThe firm's total-cost curve wo...View AnswerShow Answer

Table 13-6 Wooden Chair Factory -Refer to Table 13-6.Assume the Wooden Chair Factory currently employs 2 workers.What is the marginal product of labor when the factory adds a 3rd worker?

Correct AnswerverifiedShow Answer

Table 13-9 -Refer to Table 13-9.What is the marginal cost of producing the 1st poster?

Correct AnswerverifiedShow Answer

What are opportunity costs? How do explicit and implicit costs relate to opportunity costs?

Correct AnswerverifiedThe opportunity cost of an ite...View AnswerShow Answer

Marginal costs are costs that do not vary with the quantity of output produced.

Correct AnswerverifiedShow Answer

Economies of scale often arise because higher production levels allow specialization among workers.

Correct AnswerverifiedShow Answer

The marginal product of an input in the production process is the increase in

Correct AnswerverifiedShow Answer

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450 - 350 ...
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Total output of four workers =...
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The firm's total-cost curve wo...
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The opportunity cost of an ite...
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