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Refer to the information provided in Table 8.1 below to answer the questions that follow. Table 8.1 Produce 1 unit of output Using Techniques Units of Variable K Inputs L B 12 2 units of output 14 12 20 3 units of output 16 12 B 12 22 26) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, what production technique should this firm use to produce 2 units of output? A) production technique A B) production technique B C) The firm is indifferent between production technique A and production technique B. D) It is impossible to determine if the firm should select production technique A or B because total fixed costs are not given. Answer. B Dif: 2 Topic: Costs in the Short Run Skill: Analytic 27) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, the lowest long-run total cost of producing one unit of output is A) $16. B) $100 O $120. D) $220. Answer: B Diff: 2 Tepic: Costs in the Short Run Skill: Analytic 28) Refer to Table 8.1. Assume that the relevant time period is the short run. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, this firm's total cost of producing one unit of output is A) $100. C) $220. B) $120. D) indeterminate from this information Answer: D Diff: 2 Topic: Costs in the Short Run Skill: Analytic

Refer to the information provided in Table 8.1 below to answer the questions that follow. Table 8.1 Produce 1 unit of output Using Techniques Units of Variable K Inputs L B 12 2 units of output 14 12 20 3 units of output 16 12 B 12 22 26) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, what production technique should this firm use to produce 2 units of output? A) production technique A B) production technique B C) The firm is indifferent between production technique A and production technique B. D) It is impossible to determine if the firm should select production technique A or B because total fixed costs are not given. Answer. B Dif: 2 Topic: Costs in the Short Run Skill: Analytic 27) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, the lowest long-run total cost of producing one unit of output is A) $16. B) $100 O $120. D) $220. Answer: B Diff: 2 Tepic: Costs in the Short Run Skill: Analytic 28) Refer to Table 8.1. Assume that the relevant time period is the short run. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, this firm's total cost of producing one unit of output is A) $100. C) $220. B) $120. D) indeterminate from this information Answer: D Diff: 2 Topic: Costs in the Short Run Skill: Analytic

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Refer to the information provided in Table 8.1 below to answer the questions that follow. Table 8.1 Produce Using Techniques Units of Variable K Inputs L 1 unit of output B 12 2 units of output A 14 12 20 3 units of output 16 12 B 12 22 26) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, what production technique should this firm use to produce 2 units of output? A) production technique A B) production technique B C) The firm is indifferent between production technique A and production technique B. D) It is impossible to determine if the firm should select production technique A or B because total fixed costs are not given. Answer. B Diff: 2 Topic: Costs in the Short Run Skill: Analytic 27) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, the lowest long-run total cost of producing one unit of output is A) $16. B) $100 O $120. D) $220. Answer: B Diff: 2 Topic: Costs in the Short Run Skill: Analytic 28) Refer to Table 8.1. Assume that the relevant time period is the short run. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, this firm's total cost of producing one unit of output is A) $100. C) $220. B) $120. D) indeterminate from this information Answer: D Diff: 2 Topic: Costs in the Short Run Skill: Analytic 29) Refer to Table 8.1. Assume that the relevant time period is the short run. Assuming the price of labor (L) is $5 per unit and the price of capital (K) is $10 per unit, the average total cost of producing two unit of output is A) $20. B) $40. C) $90. D) $100. Answer: C Diff: 2 Topic: Costs in the Short Run Skill: Analytic 30) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, the marginal cost of producing the third unit of output is A) $30. C) $50. B) $40. D) indeterminate from this information. Answer: B
Transcribed Image Text:Refer to the information provided in Table 8.1 below to answer the questions that follow. Table 8.1 Produce Using Techniques Units of Variable K Inputs L 1 unit of output B 12 2 units of output A 14 12 20 3 units of output 16 12 B 12 22 26) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, what production technique should this firm use to produce 2 units of output? A) production technique A B) production technique B C) The firm is indifferent between production technique A and production technique B. D) It is impossible to determine if the firm should select production technique A or B because total fixed costs are not given. Answer. B Diff: 2 Topic: Costs in the Short Run Skill: Analytic 27) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, the lowest long-run total cost of producing one unit of output is A) $16. B) $100 O $120. D) $220. Answer: B Diff: 2 Topic: Costs in the Short Run Skill: Analytic 28) Refer to Table 8.1. Assume that the relevant time period is the short run. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, this firm's total cost of producing one unit of output is A) $100. C) $220. B) $120. D) indeterminate from this information Answer: D Diff: 2 Topic: Costs in the Short Run Skill: Analytic 29) Refer to Table 8.1. Assume that the relevant time period is the short run. Assuming the price of labor (L) is $5 per unit and the price of capital (K) is $10 per unit, the average total cost of producing two unit of output is A) $20. B) $40. C) $90. D) $100. Answer: C Diff: 2 Topic: Costs in the Short Run Skill: Analytic 30) Refer to Table 8.1. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, the marginal cost of producing the third unit of output is A) $30. C) $50. B) $40. D) indeterminate from this information. Answer: B
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