In the above figure, curve A is thecurve and curve Cis thecurve.O A. total cost; total variable costO B. total fixed cost; total variable costOC. total variable cost; total fixed costD. total cost; total fixed costO E. total variable cost; total cost Total cost (dollars per unit)B100-80 -604034Output (units per hour)2.20

Total cost is the overall cost incurred in production, it is the sum of total fixed cost and total…

In the above figure, curve A is the curve and curve Cis the _ curve. O A. total cost; total variable cost O B. total fixed cost, total variable cost OC. total variable cost; total fixed cost O D. total cost, total fixed cost O E. total variable cost; total cost

In the above figure, curve A is the curve and curve Cis the _ curve. O A. total cost; total variable cost O B. total fixed cost, total variable cost OC. total variable cost; total fixed cost O D. total cost, total fixed cost O E. total variable cost; total cost

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.

Question

In the above figure, curve A is the
curve and curve Cis the
curve.
O A. total cost; total variable cost
O B. total fixed cost; total variable cost
OC. total variable cost; total fixed cost
D. total cost; total fixed cost
O E. total variable cost; total cost

Total cost (dollars per unit)
B
100-
80 -
60
40
3
4
Output (units per hour)
2.
20

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Consider a firm making production decisions in the short run. Select the statement(s) that must be correct. Choose one or more: O A. Average total cost will always exceed average variable cost. O B. Average total cost cannot decline as output increases, at any level of output. O C. Average fixed cost cannot increase with output, at any level of output. O D. Average variable cost is always above the average fixed cost. O E. Average variable cost cannot decline with output, at any level of output.
Suppose a particular firm exhibits constant returns to scale as it increases its output over any reasonable range. If it increases its total costs by 10%, then its: O long run average cost curve will shift to the right by 10% O average total cost will increase by 10%%. O total cost will increase by less than 10%. O output will increase by 10%. 21 tv MacBook Pro 80 O00 FA FS F6 F7 F8 19
Output Total Cost 105 ts 125 140 3 180 4 240 320 The average fixed cost at a quantity of 2 is given by ester O 52.5 O 105 O 140 O 35
May I know the correct answer???
Q2
The law of diminishing marginal product states that: O A. in the long run as the firm uses more of a variable resource with a given fixed resource marginal product will decrease eventually B. in the short run as the firm uses more of a variable resource with a given fixed resource average product will increase eventually OC. in the short run as the firm uses more of a variable resource with a given fixed resource marginal product will decrease eventually OD. None of the above
QUESTION 13 Accounting profits are typically O A. greater than economic profits because the former do not take explicit costs O B. equal to economic profits because O C. smaller than economic profits O D. greater than economic profits accounting costs include all because the former do not take because the former do not take into account opportunity costs implicit costs into account implicit costs into account
Suppose there are fixed costs and the marginal costs are constant. Then we know that Select one: a. average variable costs decrease continuously as output increases and lie above the marginal cost curve. cross out O O b. average total costs decrease continuously as output increases but always lie above the average variable cost curve which is constant. cross out c. average total costs are constant. X d. average total costs decrease continuously as output increases and lies above the average variable cost curve which is also decreasing continuously as output increases. cross out cross out
Which action would decrease per unit costs? O b. O a. Decreasing output when experiencing diseconomies of scale. Decreasing output when experiencing economies of scale. Increasing output when experiencing diseconomies of scale. O d. Increasing output when experiencing constant returns to scale. Oc.
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QUESTION 1 What is the relationship between economic and accounting profit? O a. Economic profit may be equal to or less than accounting profit. b. Economic profit is greater than accounting profit. O c. Economic profit is less than accounting profit. O d. Economic profit is equal to accounting profit. Oe. Economic profit may be equal to or greater than accounting profit.