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MICROECONOMICS 7 EXAM NEWEST VERSION -2025/2026-
100+ Q AND ANS MOST POPULAR EXAM GUARANTEED
SUCCESS
Marcella operates a small, but very successful art gallery. All but one of the
following can be classified as a variable cost arising from the physical inputs
Marcella requires to operate her business. Which is it?
physical space for the gallery
If the firm produces 5 units (quantity) that it sells at a price of $20.00 each, what
will its profits or losses equal?
losses equal $55
______________ include all of the costs of production that increase with the
quantity produced.
Variable costs
In microeconomics, the term ___________________ is synonymous with
decreasing returns of scale.
diseconomies of scale
In microeconomics, the term _____________________ is synonymous with
economies of scale.
increasing returns to scale
___________ include all spending on labor, machinery, tools, and supplies
purchased from other firms.
Total costs
, 2
The economies-of-scale curve is a long-run average cost curve, because
it allows all factors of production to change.
In order to determine the average variable cost, the firm's variable costs are
divided by _______________________.
the quantity of output
If a paper mill shuts down its operations for three months so that it produces
nothing, its __________________ will be reduced to zero?
variable costs
________________________ arises where many firms are competing in a market
to sell similar but differentiated products.
Monopolistic competition
In order to calculate marginal cost, the change in ______________ is divided by
the amount of change in quantity.
either total cost or variable cost
Which of the following should typically be ignored because spending has already
been made and cannot be changed?
sunk costs
In economics, a firm that faces no competitors is referred to as
_________________.
a monopoly
The _____________________ curve will always lie below the curve for average
cost because average cost includes _____________ in the numerator of the
calculation.
average variable cost; fixed costs
According to the definition of profit, if a profit-maximizing firm will always attempt
to produce its desired level of output at the lowest possible cost, then it will
MICROECONOMICS 7 EXAM NEWEST VERSION -2025/2026-
100+ Q AND ANS MOST POPULAR EXAM GUARANTEED
SUCCESS
Marcella operates a small, but very successful art gallery. All but one of the
following can be classified as a variable cost arising from the physical inputs
Marcella requires to operate her business. Which is it?
physical space for the gallery
If the firm produces 5 units (quantity) that it sells at a price of $20.00 each, what
will its profits or losses equal?
losses equal $55
______________ include all of the costs of production that increase with the
quantity produced.
Variable costs
In microeconomics, the term ___________________ is synonymous with
decreasing returns of scale.
diseconomies of scale
In microeconomics, the term _____________________ is synonymous with
economies of scale.
increasing returns to scale
___________ include all spending on labor, machinery, tools, and supplies
purchased from other firms.
Total costs
, 2
The economies-of-scale curve is a long-run average cost curve, because
it allows all factors of production to change.
In order to determine the average variable cost, the firm's variable costs are
divided by _______________________.
the quantity of output
If a paper mill shuts down its operations for three months so that it produces
nothing, its __________________ will be reduced to zero?
variable costs
________________________ arises where many firms are competing in a market
to sell similar but differentiated products.
Monopolistic competition
In order to calculate marginal cost, the change in ______________ is divided by
the amount of change in quantity.
either total cost or variable cost
Which of the following should typically be ignored because spending has already
been made and cannot be changed?
sunk costs
In economics, a firm that faces no competitors is referred to as
_________________.
a monopoly
The _____________________ curve will always lie below the curve for average
cost because average cost includes _____________ in the numerator of the
calculation.
average variable cost; fixed costs
According to the definition of profit, if a profit-maximizing firm will always attempt
to produce its desired level of output at the lowest possible cost, then it will
