Production and Cost
1)
Accountants include ________ costs as part of a firm's costs, while economists include
________ costs.
1)
_______
A)
explicit; no explicit
B)
implicit; no implicit
C)
explicit and implicit; implicit
D)
explicit; explicit and implicit
2)
Jane is a student at a university. She pays RM10,000 per year in tuition, RM4,000 per year
in living expenses, and RM800 per year for books. Were she not in school, she could earn
RM20,000 per year working as a bookkeeper and she would not live with her parents. What
is her economic cost of a year in college?
2)
_______
A)
RM10,000
B)
RM34,800
C)
RM14,000
D)
RM30,800
3)
Which of the following is an example of something that economists would consider a cost
but accountants would not?
3)
_______
1
, A)
the cost of materials and supplies purchased by a firm
B)
the salary that the firm actually pays to the firm's owner
C)
the interest income foregone by the firm's owner because the owner invested funds into the
firm
D)
the cost of advertising
4)
Which of the following is an example of something that economists would consider a cost
but accountants would not?
4)
_______
A)
the wages paid to employees of a firm
B)
the wages that the owner of a firm could have earned in some alternative job
C)
rent paid to a business' landlord
D)
the cost of leather used in the production of footballs
5)
In the short run, ________ factors of production are fixed, while in the long run, ________ of
them are.
5)
_______
A)
some; none
B)
all; none
C)
no; at least some
D)
all; at least some
6)
2
,Which of the following is a short-run adjustment?
6)
_______
A)
Three new firms enter the computer chip industry.
B)
A firm hires six new workers.
C)
The number of farms in Kansas increases by 10%.
D)
A firm opens two new plants.
7)
Which of the following is a long-run adjustment?
7)
______
A)
A firm lays off two workers.
B)
Two firms exit the asbestos removal industry.
C)
A manufacturer increases its purchase of raw materials.
D)
A farmer buys twice her usual amount of herbicide.
8)
Which of the following is a long-run adjustment?
8)
______
A)
A firm hires two new workers.
B)
The number of professional baseball teams increases by two.
C)
GM buys more steel for its auto plants in Michigan.
D)
3
, A farmer buys twice her usual amount of fertilizer.
9)
In the short run:
9)
______
A)
firms have the ability to enter or exit the industry.
B)
firms are able to alter some, but not all, of their factors of production.
C)
firms are unable to adjust their output choices.
D)
None of the above are correct.
10)
In the long run:
10)
______
A)
firms have the ability to enter or exit the industry.
B)
firms are able to alter some, but not all, of their resources.
C)
firms are unable to adjust their output choices.
D)
None of the above are correct.
11)
In the long run:
11)
______
A)
all factors of production are fixed.
B)
all factors of production are variable.
C)
some factors of production are variable, while at least one factor of production is fixed.
4
1)
Accountants include ________ costs as part of a firm's costs, while economists include
________ costs.
1)
_______
A)
explicit; no explicit
B)
implicit; no implicit
C)
explicit and implicit; implicit
D)
explicit; explicit and implicit
2)
Jane is a student at a university. She pays RM10,000 per year in tuition, RM4,000 per year
in living expenses, and RM800 per year for books. Were she not in school, she could earn
RM20,000 per year working as a bookkeeper and she would not live with her parents. What
is her economic cost of a year in college?
2)
_______
A)
RM10,000
B)
RM34,800
C)
RM14,000
D)
RM30,800
3)
Which of the following is an example of something that economists would consider a cost
but accountants would not?
3)
_______
1
, A)
the cost of materials and supplies purchased by a firm
B)
the salary that the firm actually pays to the firm's owner
C)
the interest income foregone by the firm's owner because the owner invested funds into the
firm
D)
the cost of advertising
4)
Which of the following is an example of something that economists would consider a cost
but accountants would not?
4)
_______
A)
the wages paid to employees of a firm
B)
the wages that the owner of a firm could have earned in some alternative job
C)
rent paid to a business' landlord
D)
the cost of leather used in the production of footballs
5)
In the short run, ________ factors of production are fixed, while in the long run, ________ of
them are.
5)
_______
A)
some; none
B)
all; none
C)
no; at least some
D)
all; at least some
6)
2
,Which of the following is a short-run adjustment?
6)
_______
A)
Three new firms enter the computer chip industry.
B)
A firm hires six new workers.
C)
The number of farms in Kansas increases by 10%.
D)
A firm opens two new plants.
7)
Which of the following is a long-run adjustment?
7)
______
A)
A firm lays off two workers.
B)
Two firms exit the asbestos removal industry.
C)
A manufacturer increases its purchase of raw materials.
D)
A farmer buys twice her usual amount of herbicide.
8)
Which of the following is a long-run adjustment?
8)
______
A)
A firm hires two new workers.
B)
The number of professional baseball teams increases by two.
C)
GM buys more steel for its auto plants in Michigan.
D)
3
, A farmer buys twice her usual amount of fertilizer.
9)
In the short run:
9)
______
A)
firms have the ability to enter or exit the industry.
B)
firms are able to alter some, but not all, of their factors of production.
C)
firms are unable to adjust their output choices.
D)
None of the above are correct.
10)
In the long run:
10)
______
A)
firms have the ability to enter or exit the industry.
B)
firms are able to alter some, but not all, of their resources.
C)
firms are unable to adjust their output choices.
D)
None of the above are correct.
11)
In the long run:
11)
______
A)
all factors of production are fixed.
B)
all factors of production are variable.
C)
some factors of production are variable, while at least one factor of production is fixed.
4
