Answered: This chapter discusses many types of…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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This chapter discusses many types of costs: explicit costs, implicit costs, total cost, average fixed cost, average variable cost, and marginal cost.

Fill in the type of cost that best completes each sentence.

Profits equal total revenue minus

(average fixed cost , average variable cost , explicit cost , implicit cost , marginal cost , total cost)

The term (average fixed cost , average variable cost , explicit cost , implicit cost , marginal cost , total cost) refers to costs that involve direct monetary payment by the firm.

(average fixed cost , average variable cost , explicit cost , implicit cost , marginal cost , total cost) is falling when marginal cost is below it and rising when marginal cost is above it.

The cost of producing an extra unit of output is the (average fixed cost , average variable cost , explicit cost , implicit cost , marginal cost , total cost) .

(average fixed cost , average variable cost , explicit cost , implicit cost , marginal cost , total cost) is always falling as the quantity of output increases.

The opportunity cost of running a business that does not involve cash outflow is (average fixed cost , average variable cost , explicit cost , implicit cost , marginal cost , total cost) .

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Your aunt is thinking about opening a hardware store. She estimates that it would cost $300,000 per year to rent the location and buy the stock. In addition, she would have to quit her $45,000 per year job as an accountant.

What is the opportunity cost of something?

What must be given up to acquire it

The time it takes to do something

What you pay for it

The cost to produce it

Your aunt's opportunity cost of running a hardware store for a year is $ ?

Suppose your aunt thought she could sell $350,000 worth of merchandise in a year.

Your aunt (should , or should not) ? open the store

ms & Applications(Ch 13)
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Average: /6
1. Problems and Applications Q1
This chapter discusses many types of costs: explicit costs, implicit costs, total cost, average fixed cost, average variable cost, and marginal cost. Fill in
the type of cost that best completes each sentence.
Profits equal total revenue minus
The term
refers to costs that involve direct monetary payment by the firm.
is falling when marginal cost is below it and rising when marginal cost is above it.
The cost of producing an extra unit of output is the
v is always falling as the quantity of output increases.
The opportunity cost of running a business that does not involve cash outflow is

CENGAGE MINDTAP
isnapshotld%3D
Problems & Applications(Ch 13)
Your aunt is thinking about opening a hardware store. She estimates that it would cost $300,000 per year to rent the location and buy the stoc
addition, she would have to quit her $45,000 per year job as an accountant.
What is the opportunity cost of something?
OWhat must be given up to acquire it
The time it takes to do something
What you pay for it
O The cost to produce it
Your aunt's opportunity cost of running a hardware store for a year is
Suppose your aunt thought she could sell $350,000 worth of merchandise in a year.
open the store.
Your aunt
antinue
%24

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