1、Microeconomics - Testbank 1 (Hubbard/OBrien)Chapter 10 Technology, Production, and Costs1) The average total cost of production is the: A) extra cost required to produce one more unit. B) total cost of production. C) total cost of production divided by the level of output. D) total cost of productio
2、n multiplied times the level of output. 2) Among the potential sources of an advance in technology for a producing firm is: A) better trained workers. B) more efficient physical capital. C) higher skill level of managers. D) all of the above. 3) The short run is: A) one day. B) one week. C) six mont
3、hs. D) as long it takes a particular firm to change its plant capacity. 4) A factor of production that is not fixed in the short run is: A) physical capital. B) technology. C) labor. D) land. 5) A characteristic of the long run is: A) there are no fixed inputs. B) all inputs can be varied. C) plant
4、capacity can be increased or decreased. D) all of the above. 6) Economics cost of production differ from those in accounting in that: A) economics includes expenditures for hired resources while accounting does not. B) economics adds the opportunity cost of a firm using its own resources. C) account
5、ing includes expenditures for hired resources while economics does not. D) accounting costs are always larger than economic costs. 7) Which of the following is an implicit cost of production? A) Interest paid on a loan to a bank. B) Wages paid to labor plus the cost of carrying benefits for workers.
6、 C) The utility bill paid to water, electricity, and natural gas companies. D) Rent that could have been earned on a building owned and used by the firm. 8) Implicit costs of production are also called: A) overhead. B) variable costs. C) direct costs. D) opportunity costs. 9) A factor of production
7、that generally is fixed in the short run is: A) raw materials. B) labor. C) a building. D) water. 10) The relationship between different amounts of inputs and the resulting level of output is a: A) total cost schedule. B) production possibilities frontier. C) production function. D) production quota
8、. 11) If the firm is producing nothing in the short run, then: A) total costs are zero. B) variable costs are low but positive. C) marginal costs are negative. D) fixed costs are positive. 12) As a firm hires more labor in the short run, the: A) level of total product stays constant. B) output per w
9、orker rises. C) extra output of another worker may rise at first, but eventually must fall. D) costs of production are increasing at a fixed rate per unit of output. Refer to Figure 10.1 for the questions below.Figure 10.113) In figure 10.1, diminishing returns to labor set in after: A) L1. B) L2. C
10、) L3. D) none of the above. 14) In figure 10.1, short run output is maximized at: A) L1. B) L2. C) L3. D) none of the above. 15) In figure 10.1, AP of labor declines after L2 because: A) MP of labor is below AP of labor. B) MP of labor is falling. C) MP of labor is negative. D) MP of labor is positi
11、ve. 16) If four workers can produce 18 chairs a day and five can produce 20 chairs a day, the marginal product of the fifth worker is: A) four chairs. B) five chairs. C) two chairs. D) 38 chairs. 17) The short run marginal product of labor increasing at first and then falling is an example of the la
12、w of: A) demand. B) supply. C) diminishing marginal utility. D) diminishing returns. 18) The reason the marginal product of labor in the short run increases at first and then falls is because: A) as more labor is hired, they are not as skilled as the first ones hired. B) there are fewer opportunitie
13、s for division of labor and specialization. C) the management is inefficient. D) the extra workers have busy work piled on them. 19) If 11 workers can produce a total of 54 units of a product and another worker has a marginal product of six, then the average product of 12 workers is: A) 60. B) 54. C
14、) 48. D) 5. 20) If another worker adds nine units of output to a group of workers who had an average product of seven units, then the average product of labor: A) will remain the same. B) will increase. C) will decrease. D) and what will happen to it can not be determined. 21) If average product is
15、decreasing, we know that: A) total product is negative. B) marginal product is negative. C) marginal product is smaller than average product. D) marginal product is at its positive. 22) If all we know is all workers marginal product, then total and average product can be found by: A) dividing margin
16、al costs by the number of workers. B) multiplying the average marginal product times the number of workers. C) summing the marginal values to find the total and multiplying it times the number of workers to get the average. D) summing the marginal values to find the total and dividing it by the numb
17、er of workers to get the average. 23) If we know that marginal product is equal to average product, then: A) average product is at a maximum. B) total product is at a maximum. C) marginal product is at a maximum. D) average product must be falling. 24) Marginal cost is U-shaped because of the: A) la
18、w of demand. B) law of diminishing marginal utility. C) law of diminishing returns. D) law of increasing costs. 25) Average total cost is equal to: A) average fixed costs minus average variable costs. B) total costs divided by the level of output. C) marginal costs plus variable costs. D) total cost
19、s divided by the number of workers. Refer to Figure 10.2 for the questions below.Figure 10.226) In figure 10.2, the difference between average total costs and average variable costs is: A) average fixed costs. B) marginal costs. C) fixed costs. D) sunk costs. 27) In figure 10.2, average variable cos
20、ts approach average total costs as output rises because: A) marginal costs are above average variable costs. B) average fixed costs are falling. C) fixed costs are falling. D) total costs are falling. 28) In the long run: A) all inputs in production are variable. B) there are no fixed costs. C) tota
21、l costs equal variable costs. D) all of these are correct. 29) Long run costs are U-shaped because: A) of the law of demand. B) of the law of diminishing returns. C) of economies and diseconomies of scale. D) of the law of supply. 30) If average total cost is $50 and average fixed cost is $15 when o
22、utput is 20 units, then the firms total variable cost at that level of output is: A) $1,000. B) $700. C) $300. D) impossible to determine without additional information. 31) If average total cost is $50 and average fixed cost is $15 when output is 20 units, then the firms average variable cost at th
23、at level of output is: A) $45. B) $35. C) $30. D) impossible to determine without additional information. 32) When the average total cost is $16, the level of total cost is $800, then the number of units the firm is producing is: A) impossible to determined with the information given. B) 784. C) 12,
24、800. D) 50. 33) If a firm doubles all its inputs in the long run and it finds its average cost of production has decreased, then it has: A) diminishing returns. B) economies of scale. C) diseconomies of scale. D) declining fixed costs. 34) Economies of scale exist because as a firm increases its siz
25、e in the long run: A) the firm can afford more sophisticated technology in production. B) labor and management can specialize their activities more. C) as a larger input buyer the firm can purchase inputs at a lower per unit cost. D) all of these. 35) In natural monopolies such as the generation of
26、electricity, long-run average costs continue to decrease as the plant size gets larger, because: A) diminishing returns are not present. B) diseconomies of scale are very minor but economies of scale continue. C) someone must have made a mistake at lower levels of output. D) there are no fixed costs
27、. 36) When a firms long-run average cost curve is horizontal for a range of output, then in that range the firm has: A) increasing returns to scale. B) constant returns to scale. C) decreasing returns to scale. D) constant average fixed costs. 37) An isoquant shows: A) the combinations of two goods
28、that yield the same total satisfaction. B) the combinations of two inputs that yield the same total product. C) the combinations of two inputs that cost the same total quantity of money. D) the combination of two goods that cost the same amount of money. 38) The typical shape of isoquants is: A) con
29、cave towards the origin. B) convex towards the origin. C) straight downsloping line. D) straight upsloping line. 39) As a firm substitutes labor for capital, more labor is required to equal one less unit of capital because: A) capital is always more productive than labor. B) as less capital is used,
30、 diminishing returns to labor become more pronounced. C) diseconomies of scale. D) the price of each input changes. 40) An isocost line shows: A) all the possible combinations of two inputs the firm can use. B) all the possible combinations of two inputs the firm can use that have the same total cos
31、t. C) all the possible combinations of two inputs the firm can use that have the same marginal cost. D) all the possible combinations of two inputs with constant returns to scale. 41) The position of the isocost line is determined by the: A) prices of the two inputs. B) productivities of the two inp
32、uts. C) level of total cost. D) price of the product. 42) On an isoquant/isocost graph the least cost combination of producing a given output is: A) any point on the isoquant curve. B) any point on the isocost curve. C) the tangency point between the isoquant curve and the isocost line. D) only on o
33、ne of the axes of the graph. 43) Different economies might use different combinations of inputs like labor and capital to produce the same goods because of: A) different technologies. B) differences in the productivity of the inputs. C) differences in the prices of the inputs. D) all of the above. 4
34、4) If labor is the horizontal axis input and physical capital is the vertical axis input, then at the least costs output: A) the marginal rate of technical substitution is equal to the wage rate divided by the cost of capital. B) the marginal rate of technical substitution is multiplied times the wa
35、ge rate divided by the cost of capital. C) the marginal rate of technical substitution is divided by the wage rate multiplied times the cost of capital. D) the marginal rate of technical substitution is equal to the amount of capital divided by the amount of labor. 45) If the amount of labor being u
36、sed has a marginal product of 12 units of output per worker at a wage rate of $6 per worker and the current capital amount being used has a marginal product of 20 units per machine, then for this to be a least cost combination of inputs the cost of capital must be: A) $2. B) $10. C) $20. D) Impossible to determine with the information given.
