Labor Q TC VC ATC AVC MC 0 0 $100 0 - - 1 10 110 `0 11 1 2 25 120 20 4.8 0.8 3 3
ID: 1240209 • Letter: L
Question
Labor Q TC VC ATC AVC MC
0 0 $100 0 - -
1 10 110 `0 11 1
2 25 120 20 4.8 0.8
3 35 130 30 3.71 0.85
4 40 140 40 3.5 1
5 42 150 50 3.57 1.19
13) The marginal product of the 3rd worker is:
a) 3
b) 10
c) 25
d) 35
14) How much are the variable costs per unit of labor?
a) 5
b) 10
c) 25
d) 100
15) Find the marginal costs to increase production from 25 to 35
a) $1.00
b) $1.50
c) $2.00
d) $5.00
16) For a given range of production, the extra product of each additional worker is less than the extra
product of the worker hired just before. This statement describes _________ returns.
a) constant
b) negative
c) diminishing
d) increasing
e) average
17) A production function
a) relates inputs with output.
b) generates a curve that is upward sloping.
c) shows diminishing marginal product of an input, since it gets flatter as output rises.
d) only a and c. e) a, b, and c.
18) Honda
Explanation / Answer
13. b) 10 14. d) 100 15. c) $2.00 16. c) diminishing 17. e) a, b, and c. 18. b) Honda’s AC of producing 4 cars is $56,250, and MC of producing the 5th. car is $25,000. 19. b) Boeing exhibits economies of scale. PLEASE RATE
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