If fixed cost is $200,000 and variable cost is $30 per unit over the relevant range of output, when 10,000 units are produced, the average total cost will be:
a. $20.
b. $30.
c. $50.
d. $70.
c
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The vertical distance between the total cost curve and the total variable cost curve ________ as output increases and the vertical distance between the average total cost curve and average variable cost curve ________ as output increases
A) is constant; decreases B) decreases; is constant C) increases; decreases D) decreases; increases E) decreases; decreases
A company has two locations where it employs workers doing the same job and working the same hours. Other things the same most workers would prefer to live in location A, but location A has a higher cost of living than location B
a. The company likely needs to pay workers in location A more. b. The company likely needs to pay workers in location B more. c. It's not clear if the company would need to pay more to workers in location A or location B. d. The company must pay workers the same amount.
Sadie works at a factory for $15 an hour and typically works 40 hours a week. Sadie gets a pay raise and now earns $20 an hour. She decides to work 45 hours a week at $20 an hour. Her response to the pay increase demonstrates the:
A. labor effect outweighing the price effect. B. price effect outweighing the income effect. C. income effect outweighing the price effect. D. income effect outweighing the substitution effect.
Inflation means that:
A. all prices are rising, but at different rates. B. all prices are rising and at the same rate. C. prices on average are rising, although some particular prices may be falling. D. real incomes are rising.