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In the short run:
a. all inputs are fixed.
b. all inputs are variable.
c. some inputs are fixed and some inputs are variable.
d. all costs are variable
c. some inputs are fixed and some inputs are variable.
   
The ________ is the increase in output that is produced when hiring an additional worker.
a. average product
b. total product
c. marginal product
d. marginal cost
c. marginal product
   
An input whose quantity can be changed in the short run is:
a. a marginal input.
b. a fixed input.
c. an incremental input.
d. a variable input.
d. a variable input.
   
An input whose quantity cannot be changed in the short run is:
a. a marginal input.
b. a fixed input.
c. an incremental input.
d. a variable input.
b. a fixed input.
   
The long run is a planning period:
a. over which a firm can consider all inputs as variable.
b. that is at least 5 years in length.
c. that must be over 6 months in length.
d. that must be between 6 months and 5 years.
a. over which a firm can consider all inputs as variable.
   
The marginal product of labor is:
a. the change in labor divided by the change in total product.
b. the slope of the total product of labor curve.
c. the change in average product divided by the change in the quantity of labor.
d. the change in output that occurs when capital increases by one unit.
   
A cost that does not depend on the quantity of output produced is called a:
a. marginal cost.
b. fixed cost.
c. variable cost.
d. average cost.
   
Marginal cost is the:
a. increase in total cost when one more unit of output is produced.
b. reduction in cost from economies of scale.
c. ratio of average total cost to total cost.
d. increase in output from the addition of one unit of labor.
   
The sum of fixed and variable costs is:
a. total cost.
b. marginal cost.
c. variable cost.
d. average cost.
   
Average total cost is:
a. the change in cost divided by the change in output.
b. total cost divided by output.
c. the change in output divided by the change in costs.
d. total cost times output.
b. total cost divided by output.
   
Total cost divided by the quantity of output produced is:
a. average total cost.
b. average fixed cost.
c. average product.
d. marginal cost.
   
The curve that shows the additional cost of producing each additional unit of output is called the:
a. average cost curve.
b. total cost curve.
c. marginal product curve.
d. marginal cost curve.
   
Average variable cost is:
a. the firm's variable cost per unit multiplied by the output.
b. total variable cost divided by output.
c. the difference between average total cost and total variable cost.
d. the difference between total cost and total variable cost.
   
The marginal cost curve intersects the average variable cost curve at:
a. its lowest point.
b. its maximum.
c. its end point.
d. no point; the curves don't intersect.
a. its lowest point.
   
When marginal cost is below average variable cost, average variable cost must be:
a. at its minimum.
b. at its maximum.
c. falling.
d. rising
   
When marginal cost is above average variable cost, average variable cost must be:
a. at its minimum.
b. at its maximum.
c. falling.
d. rising.
   
If a firm has lower costs per unit as it increases production in the long run, this is an example of:
a. increasing returns to scale.
b. decreasing returns to scale.
c. increasing opportunity costs.
d. scale reduction
   
Decreasing and increasing returns to scale account for the shape of the:
a. short-run average total cost curve.
b. short-run average variable cost curve.
c. long-run average total cost curve.
d. marginal cost curve in both the short run and the long run.
   
The term diminishing returns refers to:
a. a falling interest rate that can be expected as one's investment in a single asset increases.
b. a reduction in profits caused by increasing output beyond the optimal point.
c. a decrease in total output due to the firm hiring uneducated workers.
d. a decrease in the extra output due to the use of an additional unit of a variable input when all
    other inputs are held constant.
   
Diminishing marginal returns occur when:
a. each additional unit of a variable factor adds more to total output than the previous unit.
b. an additional variable factor adds less to total output than the previous unit.
c. the marginal product of a variable factor is increasing but at a decreasing rate.
d. total product decreases.
b. an additional variable factor adds less to total output than the previous unit.
   
In the short run:
 
a) all inputs are fixed.
b) all costs are variable.
c) all inputs are variable.
d) some inputs are fixed and some inputs are variable.
   
The idea of diminishing returns to an input in production suggests that if a local college adds more
custodians (input), the marginal product of the custodians will ________.
 
a) increase at an increasing rate
b) increase at a decreasing rate
c) not change
d) decrease
   
In economics, the short run is:
 
a) less than 1 week.
b) less than 1 month.
c) at least one input is fixed.
d) enough time to change all inputs to production.
   
In the long run:
a) at least one input is variable and one input is fixed.
b) inputs are neither variable nor fixed.
c) all inputs are fixed.
d) all inputs are variable.
   
An input whose quantity can be changed during the short run is:
 
a) a marginal input.
b) an incremental input.
c) a variable input.
d) a fixed input.
   
The long run refers to the period for which:
 
a) marginal costs are decreasing.
b) diminishing returns causes marginal cost to increase.
c) all inputs are variable.
d) a fixed input exists.
   
Marginal cost is the change in:
 
a) average cost divided by change in output.
b) total cost divided by change in output.
c) total cost divided by average cost.
d) total cost divided by change in a variable input.
   
Total cost divided by the quantity of output produced is:
 
a) average total cost.
b) average product.
c) average fixed cost.
d) marginal cost.
   
The ________ is the increase in output that is produced when hiring an additional worker.
 
a) average product
b) total product
c) marginal cost
d) marginal product
   
An input whose quantity can be changed at any time is:
 
a) a variable input.
b) an incremental input.
c) a fixed input.
d) a marginal input.
   
A curve that shows the quantities of output that can be obtained from different quantities of a variable input,
for a given quantity of the fixed input, is called the ________ curve.
 
a) total product
b) average total quantity
c) total input
d) marginal input
   
An input whose quantity cannot be changed during the short run is:
 
a) a variable input.
b) an incremental input.
c) a marginal iput.
d) a fixed input.
   
Which of the following cost concepts is correctly defined?
 
a) MC = ΔTC / ΔFC
b) ATC = AVC + AFC
c) ATC = VC + FC
d) TC = AVC + AFC
   
Total cost divided by the quantity of output produced is:
 
a) average fixed cost.
b) marginal cost.
c) average variable cost.
d) average total cost.
   
Diminishing marginal returns to the variable inputs causes the total cost curve to become steeper as output increases.
 
True
  In economics, the short run is:
enough time to vary output but not plant capacity
   
As output increases, there is a greater quantity of output over which fixed cost is distributed, leading to
decreased average fixed cost. This result is known as the ________ effect.
 
Spreading
   
Which of the following is the mathematical definition for the marginal cost curve?
 
change in total cost / change in quantity
   
An input whose quantity can be varied at any time is known as a(n)_____ input.
 
Variable
   
Tankao makes Bluetooth sets for mobile devices. When 50 Bluetooth sets are produced in the short run, the
average variable cost is $30. Tankao's average _____ cost is _____.
 
total; greater than 30
   
In the short run:
 
some inputs are fixed, and some inputs are variable
   
For Heidi, the marginal cost of producing one additional photograph equals the change in _____ divided
by the change in the _____ of photographs.
 
total cost; quantity or number
   
The shape of the long-run average total cost curve is primarily due to:
 
diminishing returns
   
When Caroline's dress factory hires two workers, the total product is 50 dresses. When she hires three workers,
total product is 48, and when she hires four workers, total product is 45.
The marginal product of the third and fourth workers is:
 
decreasing and negative
   
The idea of diminishing returns to an input in production suggests that if a local college adds more custodians,
the marginal product of labor for the custodial staff will:
 
Decrease
   
Diminishing returns to an input occur:
 
when some inputs are fixed and some are variable
   
When the marginal product of labor is decreasing, marginal cost is:
 
Increasing
   
Total cost divided by the quantity of output produced is:
 
average total cost
   
You run a business producing picture frames. This month your total cost of production is $10,000, your variable cost of production is $6,000, and
you produce 3,000 picture frames. It follows that average _____ cost is _____.
 
variable; $2
   
The proposition of diminishing returns to an input applies if the quantity of all other inputs is held:
 
Fixed
   
An input whose quantity can be changed in the short run is a(n) _____ input.
 
Variable
   
The advantage of specialization in production is one of the primary reasons for decreasing returns to scale.
 
false
   
When marginal cost is rising:
 
both average variable cost and average total cost may be rising or falling
   
Average total cost is:
 
total cost divided by quantity
   
Production function is
 
the relationship between the quantity a firm produces output and the quantity of inputs
   
A firm's marginal cost is:
 
the slope of the total cost curve
   
Fixed Input is
 
an input that can't be varied during same period
   
Marginal cost is the:
 
increase in total cost when one more unit of output is produced
   
If average total cost is declining, marginal cost cannot be increasing.
 
false