ECON 2102 Exam #2 Exam Questions and Answers| New Update with 100% Correct Answers
A production function shows How a firm's production changes as quantity of labor and other
inputs changes.
A production function shows the Maximum output that can be produced with varying
combinations of factor inputs.
The period in which at least one input is fixed in quantity is the Short run.
The short-run production function shows how output changes when The quantity of labor
changes.
The marginal physical product is the Change in total output associated with one additional
unit of the variable input.
If a firm could hire all the workers it wanted at a zero wage (i.e., the workers are volunteers),
the firm should hire Enough workers to produce where the MPP equals zero.
The change in total output associated with one additional unit of input is the Marginal
physical product.
Diminishing returns occur because A firm increases the amount of a variable input without
changing a fixed input.
In the short run, the law of diminishing returns Can be observed in every production
process.
Which of the following is the best explanation of why the law of diminishing returns does not
apply in the long run? In the long run, firms can increase the availability of space and
equipment to keep up with the increase in variable inputs.
, If an additional unit of labor costs $20 and has a MPP of 15 units of output, the marginal cost is
$1.33.
If the marginal physical product (MPP) is falling, then the Marginal cost of each unit of
output is rising.
Marginal cost Rises as a direct result of diminishing returns.
Which of the following costs do not change when output changes in the short run?
In the short run, when a firm produces zero output, total cost equals Fixed costs.
Marginal cost is equal to The change in total costs divided by the change in quantity
produced.
At any given rate of output, the difference between total cost and fixed cost is
Changes in short-run total costs result from changes in Variable cost.
The marginal cost curve intersects the minimum of the curve representing ATC.
Average total cost is important to a business because It tells the firm what the profit per unit
produced is.
If the marginal cost curve is rising, which of the following must be true? Total costs must be
rising.
A U-shaped average total cost curve implies First marginal cost below average total cost,
and then marginal cost above average total cost.
A production function shows How a firm's production changes as quantity of labor and other
inputs changes.
A production function shows the Maximum output that can be produced with varying
combinations of factor inputs.
The period in which at least one input is fixed in quantity is the Short run.
The short-run production function shows how output changes when The quantity of labor
changes.
The marginal physical product is the Change in total output associated with one additional
unit of the variable input.
If a firm could hire all the workers it wanted at a zero wage (i.e., the workers are volunteers),
the firm should hire Enough workers to produce where the MPP equals zero.
The change in total output associated with one additional unit of input is the Marginal
physical product.
Diminishing returns occur because A firm increases the amount of a variable input without
changing a fixed input.
In the short run, the law of diminishing returns Can be observed in every production
process.
Which of the following is the best explanation of why the law of diminishing returns does not
apply in the long run? In the long run, firms can increase the availability of space and
equipment to keep up with the increase in variable inputs.
, If an additional unit of labor costs $20 and has a MPP of 15 units of output, the marginal cost is
$1.33.
If the marginal physical product (MPP) is falling, then the Marginal cost of each unit of
output is rising.
Marginal cost Rises as a direct result of diminishing returns.
Which of the following costs do not change when output changes in the short run?
In the short run, when a firm produces zero output, total cost equals Fixed costs.
Marginal cost is equal to The change in total costs divided by the change in quantity
produced.
At any given rate of output, the difference between total cost and fixed cost is
Changes in short-run total costs result from changes in Variable cost.
The marginal cost curve intersects the minimum of the curve representing ATC.
Average total cost is important to a business because It tells the firm what the profit per unit
produced is.
If the marginal cost curve is rising, which of the following must be true? Total costs must be
rising.
A U-shaped average total cost curve implies First marginal cost below average total cost,
and then marginal cost above average total cost.
