Question 1

What is the significance of the minimum point on the average total cost curve?

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Question 2

Refer to the diagram below and indicate whether the following statements is true or false a)In region A,MP > 0. b)In region A,AP > MP c)In region B,MP is at first > 0 and then < 0. d)In region C,AP > MP e)In region C,AP < 0

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Question 3

The data in Table 6.1 are for Sam's Strawberries.The quantities are for number of tones of strawberries per month.
  a)What is the amount of TFC?
b)What is the MC of the third tonne produced?
c)What is the TVC of producing 4 tonnes?
d)What is the ATC of producing 2 tonnes?

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Question 4

Why would firms want to operate at an output level above economic capacity?

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Question 5

What is the significance of the minimum point on the average variable cost curve?

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Question 6

Complete the following table.

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 ...

Question 7

State whether each of the cost curves is U-shaped.
a)ATC curve
b)AVC curve
c)AFC curve
d)MC curve
e)TFC curve

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Question 8

Differentiate between the short-run and the long-run.

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Question 9

What is amount of the opportunity cost of a sunk cost? Explain

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Question 10

Why would a firm not produce above economic capacity indefinitely?

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Question 11

Differentiate between economic profits and accounting profits.

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Question 12

The total cost of producing 5 premium leather shoes is $900.If the average variable cost is $60,what is total fixed cost?

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Question 13

Why are firms at times forced to operate at an output level less than at economic capacity?

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Question 14

State whether each of the following is an explicit cost or implicit cost for a student attending university.
a)Tuition fee
b)Stress and anxiety from studying
c)Parking fee
d)Lost income

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Question 15

Complete the following table.

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 ...

Question 16

Label each of the following cost curves.

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Question 17

"A change in the AVC curve will lead to a change in the ATC curve;therefore,if there is a change in the ATC curve,there must have been a change in the AVC curve." Evaluate this statement.

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Question 18

What might cause the MC curve to shift down?

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Question 19

"A downward shift in the average fixed cost curve will lead to a downward shift in the marginal cost curve." Evaluate this statement.

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Quiz 6: A Firms Production Decisions and Costs in the Short Run

What is the significance of the minimum point on the average total cost curve?

Refer to the diagram below and indicate whether the following statements is true or false a)In region A,MP > 0. b)In region A,AP > MP c)In region B,MP is at first > 0 and then < 0. d)In region C,AP > MP e)In region C,AP < 0

The data in Table 6.1 are for Sam's Strawberries.The quantities are for number of tones of strawberries per month. a)What is the amount of TFC? b)What is the MC of the third tonne produced? c)What is the TVC of producing 4 tonnes? d)What is the ATC of producing 2 tonnes?

Why would firms want to operate at an output level above economic capacity?

What is the significance of the minimum point on the average variable cost curve?

Complete the following table.

State whether each of the cost curves is U-shaped. a)ATC curve b)AVC curve c)AFC curve d)MC curve e)TFC curve

Differentiate between the short-run and the long-run.

What is amount of the opportunity cost of a sunk cost? Explain

Why would a firm not produce above economic capacity indefinitely?

Differentiate between economic profits and accounting profits.

The total cost of producing 5 premium leather shoes is $900.If the average variable cost is $60,what is total fixed cost?

Why are firms at times forced to operate at an output level less than at economic capacity?

State whether each of the following is an explicit cost or implicit cost for a student attending university. a)Tuition fee b)Stress and anxiety from studying c)Parking fee d)Lost income

Complete the following table.

Label each of the following cost curves.

"A change in the AVC curve will lead to a change in the ATC curve;therefore,if there is a change in the ATC curve,there must have been a change in the AVC curve." Evaluate this statement.

What might cause the MC curve to shift down?

"A downward shift in the average fixed cost curve will lead to a downward shift in the marginal cost curve." Evaluate this statement.