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.Management Sciences
Category: Average And Total Cost
If a production function exhibits diminishing marginal product the slope of the corresponding total-cost curve ?
A. is liner (a straight line)
B. could be any of these answers
C. becomes steeper as the quantity of output increases
D. become flatter as the quantity of output increases.
Economic profit is equal to total revenue minus ?
A. variable costs
B. implicit costs
C. explicit costs
D. marginal costs
If a production function exhibits diminishing marginal product. its slope ?
A. is linear (a straight line)
B. becomes steeper as the quantity of the input increase
C. could be any of these answers
D. becomes flatter as the quantity of the input increase
The efficient scale of production is the quantity of output that minimizes ?
A. average fixed cost
B. average total cost
C. average variable cost
D. marginal cost
Which of the following is a variable cost in the short run ?
A. rent on the factory
B. wages paid to factory labor
C. interest payments on borrowed financial capital
D. payments on the lease for factory equipment
E. salaries paid to upper management
When marginal costs are below average total costs ?
A. average fixed cost is rising
B. average total cost is falling
C. average total cost is raising
D. average total cost is minimized
Accounting profit is equal to total revenue minus ?
A. implicit costs
B. variable costs
C. the sum of implicit and explicit costs.
D. explicit costs.
E. marginal costs
In the long run, if a very small factory were to expand its scale of operations it is likely that it would initially experience ?
A. an increase in average total costs
B. diseconomies of scale
C. economies of scale
D. constant returns to scale
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