Answer the following statements true (T) or false (F)
1. The average product can be calculated for any unit of input by dividing the total product by the marginal product.
2. If all inputs are increased by 25 percent and output by 35 percent, increasing returns to scale exist.
3. Implicit cost is an opportunity cost of doing business.
4. Opportunity cost and implicit cost are both explicit costs.
5. Marginal cost is the change in total cost that results from producing one less or one more unit of output.
1. FALSE
2. TRUE
3. TRUE
4. FALSE
5. TRUE
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According to these relationships, the efficient output level arises where
Consider the following model for the production of refined oil: MSC = 10 + 0.5Q; MEC = 0.3Q; MSB = 30 – 0.3Q; MEB = 0. a. QE = 25 b. QE = 40 c. QE = 20 d. none of the above
Refer to Table 5.3. In order to weigh which of the job choices is riskiest, an individual should look at
A) the deviation, which is the difference between the probabilities of the two outcomes. B) the deviation, which is the difference between the dollar amounts of the two outcomes. C) the average deviation, which is found by averaging the dollar amounts of the two outcomes. D) the standard deviation, which is the square root of the average squared deviation. E) the standard deviation, which is the squared average square root of the deviation.
The level of production that minimizes long-run average total costs is referred to as the:
A. economically efficient level of production. B. minimum efficient level of production. C. minimum profitable level of production. D. technically efficient level of production.
The inflation rate is the
A. Annual percentage rate increase in tax brackets. B. Monthly percentage rate increase in the price of all goods and services. C. Monthly adjustment of wages to the cost of living. D. Annual percentage rate increase in the average price level.