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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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
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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
QUESTION 18 The law of diminishing returns indicates that O A. the demand for goods O C. as extra units of a variable O D. beyond some point, the extra utility O B. because of economies and diseconomies of scale, a competitive resource are added to a fixed resource, marginal product will decline beyond some point derived from additional units of a produced by purely competitive industries is downwarde sloping product will yield the consumer firm's long-run average total cost curve will be U-shaped smaller and smaller extra amounts of satisfaction
How does a lump sum tax affect the fixed costs and variable costs of a producer? Select one: a. A lump sum tax does not affect fixed costs but it does increase variable costs. O b. A lump sum tax decreases both fixed costs and variable costs. O c. A lump sum tax increases fixed costs but it does not affect variable costs. O d. A lump sum tax increases both fixed costs and variable costs.
A firm will operate so long as the price O A. exceeds average variable cost. OB. equals the opportunity cost. O C. exceeds average fixed cost. O D. exceeds average total cost.
The following is a table of cost for a toy manufacturing firm. The variable input is labor. Use this table to answer the following question. Average variable Average fixed cost Average Variable Quantity of toys Total costs cost total cost costs $0 $20 $10 A $40 В In the cell B, which number is correct? 10 O 5 none of these options is correct O 15
The figure at right illustrates short-run cost curves for a firm. Based on this figure, which of the following is true? O A. A is the total cost curve, B is the marginal cost curve, and C is the total fixed cost curve. O B. A is the average variable cost curve, B is the total fixed cost curve, and C is the average total cost curve. O C. A is the total cost curve, B is the total variable cost curve, and C is the total fixed cost curve. O D. A is the total cost curve, B is the total variable cost curve, and C is the marginal cost curve. O E. A is the average variable cost curve, B is the average total cost curve, and C is the marginal cost curve. Quantity с
Let's assume that a firm produces 60 products. Its total weekly cost (TC) at this output is $2,100. This includes TVC and TFC. We also know that the firm employs 3 part- time workers at a wage cost of $600 per worker per week. This is the firm's only variable cost (TVC). What is the firm's average fixed cost (AFC) at this output? O $2.50. O $2. O $5. O $100. O $10. Let's assume that a firm's total weekly costs are as follows: 1. Salaries of hired workers $5,000. 2. Supplies = $1,000. 3. Rent = $600, 4. The owners have invested a certain amount of their own money into the business. This could have earned them interest of $200 per week if they had chosen to put it into a bank instead of investing it into their business. 5. The value of the owner's time is estimated to be $800 per week. What are the firm's total economic costs? O $6.000 O $7.600. O $900. $7.500. O $6.700.
QUESTION 18 Table Average Average Average Total Total Fixed Variable Marginal Quantity Fixed Variable Cost Cost Cost Cost Cost Cost Cost $50 S50 SO -- -- -- 1 $150 A C D E F G H I S120 J K 3 M P $120 R Refer to Table. Based on the information given in the above table, the value of F will be O a. $200 O b.$50 O c. $150 O d. $100
Which of the following is always true? When marginal costs are less than average total costs, average total costs will be decreasing. When average fixed costs are falling, marginal costs must be less than average fixed costs. O When average fixed costs are rising, marginal costs must be greater than average total costs. When marginal costs are greater than average total costs, average total costs will be decreasing.