Question 1

Mindy's company manufactures rubber balls used by elementary schools for playground activities. The table below sets out her firm's production cost information. Some values are missing. Which of the following statements is correct?

Accepted Answer

A)   A = 20; E = 45
B)   A = 25; E = 45
C)   A = 25; E = 5
D)   A = 20; E = 5

Question 2

A firm's ___________ consist of expenditures that must be made before production starts that typically, over the short run, _______________ regardless of the level of production.

Accepted Answer

A)   fixed costs; do not change,
B)   variable costs; are constantly changing,
C)   fixed costs; are consistently changing,
D)   variable costs; do not change,

Question 3

________________________ arises where many firms are competing in a market to sell similar but differentiated products.

Accepted Answer

A)   Oligopolistic competition
B)   Perfect competition
C)   Monopolistic competition
D)   Monogopolised competition

Question 4

Economies of scale may arise from all but one of the following. Which one is it?

Accepted Answer

A)   doubling promotional expenses to expand sale more than proportionately
B)   having a larger retail space can expand sales more than proportionately
C)   spreading the fixed-costs of administration over more customers holds average costs down
D)   government economic subsidies protect firms from competition to avoid losses.

Question 5

I'MaPizzaCo. produces and sells specialty pizzas. Last year, it produced 8,000 mushroom, sausage and spinach pizzas and sold each one for $8. To produce these 8,000 specialty pizzas, the company incurred variable costs of $24,000 and a total cost of $40,000. I'MaPizzaCo's average fixed cost to produce 8,000 specialty pizzas was

Accepted Answer

A)   $3.00
B)   $2.00
C)   $1.80
D)   $1.60

Question 6

If a solar panel manufacturer wants to look at its total costs of production in the short run, which of the following would provide a useful starting point?

Accepted Answer

A)   divide total costs into two categories: variable costs that can't be changed in the short run and fixed costs that can be
B)   divide the total costs of production by the quantity of output
C)   divide the variable costs of production by the quantity of output
D)   divide total costs into two categories: fixed costs that can't be changed in the short run and variable costs that can be

Question 7

The ______________ of all firms can be broken down into some common underlying patterns.

Accepted Answer

A)   total revenues
B)   diminishing short-run costs
C)   cost structure
D)   diminishing long-run costs

Question 8

Which of the following falls outside of the classification of business expenses that fall into the category of fixed costs?

Accepted Answer

A)   costs that must be made before production starts
B)   costs that vary according to specific line of business
C)   costs incurred in the act of producing
D)   costs incurred as advertising expenses

Question 9

The term _____________ is used to describe the additional cost of producing one more unit.

Accepted Answer

A)   average cost
B)   fixed cost
C)   variable cost
D)   marginal cost

Question 10

I'MABigCorp. produces and sells kitchen wares. Last year, it produced 7,000 can openers and sold each one for $6. To produce the 7,000 can openers, the company incurred variable costs of $28,000 and a total cost of $45,000. I'MABIGCorp.'s average fixed cost to produce the 7,000 can openers was

Accepted Answer

A)   $1.50
B)   $1.23
C)   $2.25
D)   $2.43

Question 11

_____________________ help to explain why every economy, as it develops, has an increasing proportion of its population living in urban areas.

Accepted Answer

A)   Economies of scale
B)   Constant returns to scale
C)   Agglomeration factors
D)   Diseconomies of scale

Question 12

In economics, a firm that faces no competitors is referred to as _________________.

Accepted Answer

A)   an oligopoly
B)   a monopoly
C)   a perfect competitor
D)   an oligopolizor

Question 13

In order to reduce the harmful affects of recession and carbon emissions, the government provided tax incentives for manufacturing firm's to ___________________ that provide alternative, more efficient methods of combining inputs to produce output.

Accepted Answer

A)   acquire energy efficient production technologies
B)   increase the returns to scale
C)   maintain constant returns to scale
D)   create perfect competition between firms

Question 14

The future of cities in the United States and in other countries will be determined by their ability to benefit from the _________________ and to minimize or counterbalance the ______________________.

Accepted Answer

A)   economies of agglomeration; corresponding diseconomies
B)   economies of scale; agglomeration factors
C)   diverse population; greater returns to scale of illegal activities
D)   constant returns to scale; market-orientated system

Question 15

-Refer to the diagram above. Based on the information illustrated in the graph, which of the following is correct?

Accepted Answer

A)   producing a marginal unit is reducing average costs overall
B)   the marginal cost of production for producing an additional unit is below the cost for producing the earlier units
C)   the transition point between where MC is pulling down and pulling up AC always occurs at the minimum point of the AC curve
D)   low marginal costs first pull up the overall average costs

Question 16

Briefly discuss average variable costs, including how they are calculated, how they typically on a graph, and how they are related to determining profitability.

Accepted Answer

Average variable cost is calculated by t...

Question 17

The table below sets out cost information for the production of volley balls. Some values are missing. Which of the following statements is correct?

Accepted Answer

A)   A = 42; E = 40
B)   A = 70; E = 40
C)   A = 42, E = 12
D)   A = 70; E = 12

Question 18

Which of the following falls outside of the classification of business expenditures that fall into the category of variable costs?

Accepted Answer

A)   costs that increase with the quantity produced
B)   costs of research and development
C)   costs related to labor expenditures
D)   costs related to physical inputs

Question 19

If I'maJuiceCo. establishes a bottling plant in Delaware, it will most likely

Accepted Answer

A)   use production technologies that require more workers.
B)   strive for economies of scale where quantity of output falls as the cost of production falls.
C)   strive to reach economies of scale that will result in producing at a higher average cost.
D)   use production technologies that conserve on the number of workers.

Question 20

Marcella operates a small, but very successful art gallery. All but one of the following can be classified as a variable cost arising from the physical inputs Marcella requires to operate her business. Which is it?

Accepted Answer

A)   physical space for the gallery
B)   costs of purchasing art work to sell in the gallery
C)   wages paid to three part-time employees
D)   accountant's fees for preparing tax returns

Exam 7: Cost and Industry Structure

Marcella operates a small, but very successful art gallery. All but one of the following can be classified as a variable cost arising from the physical inputs Marcella requires to operate her business. Which is it?

Correct Answer
verified

The table below sets out cost information for the production of volley balls. Some values are missing. Which of the following statements is correct?

Correct Answer
verified

Economies of scale may arise from all but one of the following. Which one is it?

Correct Answer
verified

-Refer to the diagram above. Based on the information illustrated in the graph, which of the following is correct?

Correct Answer
verified

Correct Answer
verified

If a solar panel manufacturer wants to look at its total costs of production in the short run, which of the following would provide a useful starting point?

Correct Answer
verified

Briefly discuss average variable costs, including how they are calculated, how they typically on a graph, and how they are related to determining profitability.

Correct Answer
verified
Average variable cost is calculated by t...
View Answer

Which of the following falls outside of the classification of business expenditures that fall into the category of variable costs?

Correct Answer
verified

Which of the following falls outside of the classification of business expenses that fall into the category of fixed costs?

Correct Answer
verified

The future of cities in the United States and in other countries will be determined by their ability to benefit from the _ and to minimize or counterbalance the ______.

Correct Answer
verified

The ______________ of all firms can be broken down into some common underlying patterns.

Correct Answer
verified

If I'maJuiceCo. establishes a bottling plant in Delaware, it will most likely

Correct Answer
verified

In order to reduce the harmful affects of recession and carbon emissions, the government provided tax incentives for manufacturing firm's to ___________________ that provide alternative, more efficient methods of combining inputs to produce output.

Correct Answer
verified

_____________________ help to explain why every economy, as it develops, has an increasing proportion of its population living in urban areas.

Correct Answer
verified

In economics, a firm that faces no competitors is referred to as _________________.

Correct Answer
verified

Mindy's company manufactures rubber balls used by elementary schools for playground activities. The table below sets out her firm's production cost information. Some values are missing. Which of the following statements is correct?

Correct Answer
verified

The term _____________ is used to describe the additional cost of producing one more unit.

Correct Answer
verified

I'MABigCorp. produces and sells kitchen wares. Last year, it produced 7,000 can openers and sold each one for $6. To produce the 7,000 can openers, the company incurred variable costs of $28,000 and a total cost of $45,000. I'MABIGCorp.'s average fixed cost to produce the 7,000 can openers was

Correct Answer
verified

________________________ arises where many firms are competing in a market to sell similar but differentiated products.

Correct Answer
verified

A firm's _ consist of expenditures that must be made before production starts that typically, over the short run, _____ regardless of the level of production.

Correct Answer
verified

Exam 7: Cost and Industry Structure

Marcella operates a small, but very successful art gallery. All but one of the following can be classified as a variable cost arising from the physical inputs Marcella requires to operate her business. Which is it?

Correct AnswerverifiedShow Answer

The table below sets out cost information for the production of volley balls. Some values are missing. Which of the following statements is correct?

Correct AnswerverifiedShow Answer

Economies of scale may arise from all but one of the following. Which one is it?

Correct AnswerverifiedShow Answer

-Refer to the diagram above. Based on the information illustrated in the graph, which of the following is correct?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a solar panel manufacturer wants to look at its total costs of production in the short run, which of the following would provide a useful starting point?

Correct AnswerverifiedShow Answer

Briefly discuss average variable costs, including how they are calculated, how they typically on a graph, and how they are related to determining profitability.

Correct AnswerverifiedAverage variable cost is calculated by t...View AnswerShow Answer

Which of the following falls outside of the classification of business expenditures that fall into the category of variable costs?

Correct AnswerverifiedShow Answer

Which of the following falls outside of the classification of business expenses that fall into the category of fixed costs?

Correct AnswerverifiedShow Answer

The future of cities in the United States and in other countries will be determined by their ability to benefit from the _________________ and to minimize or counterbalance the ______________________.

Correct AnswerverifiedShow Answer

The ______________ of all firms can be broken down into some common underlying patterns.

Correct AnswerverifiedShow Answer

If I'maJuiceCo. establishes a bottling plant in Delaware, it will most likely

Correct AnswerverifiedShow Answer

In order to reduce the harmful affects of recession and carbon emissions, the government provided tax incentives for manufacturing firm's to ___________________ that provide alternative, more efficient methods of combining inputs to produce output.

Correct AnswerverifiedShow Answer

_____________________ help to explain why every economy, as it develops, has an increasing proportion of its population living in urban areas.

Correct AnswerverifiedShow Answer

In economics, a firm that faces no competitors is referred to as _________________.

Correct AnswerverifiedShow Answer

Mindy's company manufactures rubber balls used by elementary schools for playground activities. The table below sets out her firm's production cost information. Some values are missing. Which of the following statements is correct?

Correct AnswerverifiedShow Answer

The term _____________ is used to describe the additional cost of producing one more unit.

Correct AnswerverifiedShow Answer

I'MABigCorp. produces and sells kitchen wares. Last year, it produced 7,000 can openers and sold each one for $6. To produce the 7,000 can openers, the company incurred variable costs of $28,000 and a total cost of $45,000. I'MABIGCorp.'s average fixed cost to produce the 7,000 can openers was

Correct AnswerverifiedShow Answer

________________________ arises where many firms are competing in a market to sell similar but differentiated products.

Correct AnswerverifiedShow Answer

A firm's ___________ consist of expenditures that must be made before production starts that typically, over the short run, _______________ regardless of the level of production.

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
verified
Average variable cost is calculated by t...
View Answer

Correct Answer
verified

Correct Answer
verified

The future of cities in the United States and in other countries will be determined by their ability to benefit from the _ and to minimize or counterbalance the ______.

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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A firm's _ consist of expenditures that must be made before production starts that typically, over the short run, _____ regardless of the level of production.

Correct Answer
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