2 1 3 4 A is an organization that produces goods or services for sale production function Incorrect firm True Answer Correct variable input Incorrect fixed input Incorrect In the short run all inputs are fixed Incorrect all inputs are variable Incorrect some inputs are fixed and some inputs are variable True Answer Correct all costs are variable Incorrect The is the increase in output that is produced when hiring an additional worker average product Incorrect total product Incorrect marginal product True Answer Correct marginal cost Incorrect Lauren has 11 people working in her tangerine grove The marginal product of the eleventh worker equals 13 bushels of tangerines If she hires a twelfth worker the marginal product of that worker will equal 14 bushels Incorrect 15 bushels Incorrect 12 bushels Incorrect The answer cannot be determined with the information available True Answer Correct 5 The total product curve shows the relation between output and the quantity of a variable input for varying levels of the fixed input Incorrect will become flatter as output increases if there are diminishing returns to the variable input True Answer Correct will be downward sloping if there are diminishing returns to the variable input Incorrect 6 7 will become horizontal when the marginal product of the variable input is constant Incorrect Reference Ref 11 1 Table Labor and Output Look at the table Labor and Output The marginal product of the fifth worker is 8 Incorrect 4 True Answer Correct 3 Incorrect 40 Incorrect Reference Ref 11 1 Table Labor and Output Look at the table Labor and Output The marginal product of the fourth worker is 9 Incorrect 36 Incorrect 10 Incorrect 6 True Answer Correct 8 The term diminishing returns refers to a falling interest rate that can be expected as one s investment in a single asset increases Incorrect a reduction in profits caused by increasing output beyond the optimal point Incorrect a decrease in total output due to the firm hiring uneducated workers Incorrect a decrease in the extra output due to the use of an additional unit of a variable input when all other inputs are held constant True Answer Correct The idea of diminishing returns to an input in production suggests that if a local college adds more custodians the marginal product of labor for the custodial staff will increase at an increasing rate Incorrect increase at a decreasing rate Incorrect decrease True Answer Correct not change Incorrect Diminishing returns to an input occur when all inputs are fixed Incorrect when some inputs are fixed and some are variable True Answer Correct when all inputs are variable Incorrect only in the long run Incorrect If two firms are identical in all respects except that one has more capital than another the total product curve for the firm with more capital must equal the total product curve for the firm with less capital Incorrect will lie above the total product curve for the firm with less capital True Answer Correct will lie below the total product curve for the firm with less capital Incorrect will show no diminishing marginal returns Incorrect If two firms are identical in all respects except that one has more capital than another the marginal product curve for the firm with more capital 9 10 11 12 must equal the marginal product curve for the firm with less capital Incorrect will lie above the marginal product curve for the firm with less capital True Answer Correct will lie below the total marginal curve for the firm with less capital Incorrect will show no diminishing marginal returns Incorrect 13 Figure The Marginal Product of Labor Reference Ref 11 2 Figure The Marginal Product of Labor Look at the figure The Marginal Product of Labor The total product for three workers is 51 bushels True Answer Correct 45 bushels Incorrect 39 bushels Incorrect 15 bushels Incorrect Figure The Marginal Product of Labor 14 Reference Ref 11 2 Figure The Marginal Product of Labor Look at the figure The Marginal Product of Labor The total product of labor for five workers is 11 bushels Incorrect 45 bushels Incorrect 55 bushels Incorrect 75 bushels True Answer Correct Figure The Marginal Product of Labor 15 Reference Ref 11 2 Figure The Marginal Product of Labor Look at the figure The Marginal Product of Labor The total product of labor for eight workers is 40 bushels Incorrect 35 bushels Incorrect 96 bushels True Answer Correct 75 bushels Incorrect 16 17 In economics the short run is defined as less than 1 year Incorrect less than 6 months Incorrect period in which some inputs are considered to be fixed in quantity True Answer Correct period in which some inputs are fixed but it cannot exceed 1 year Incorrect In economics the short run is less than 1 week Incorrect less than 1 month Incorrect enough time to vary output but not plant capacity True 18 19 20 Answer Correct enough time to change all inputs to production Incorrect An input whose quantity can be changed in the short run is a marginal input Incorrect a fixed input Incorrect an incremental input Incorrect a variable input True Answer Correct An input whose quantity cannot be changed in the short run is a marginal input Incorrect a fixed input True Answer Correct an incremental input Incorrect a variable input Incorrect A fixed input is one that exists in nature and there is only so much of it Incorrect that can be used for one thing only Incorrect that can never produce more or less in any period Incorrect whose quantity cannot be changed in the short run True Answer Correct 21 The long run is a planning period over which a firm can consider all inputs as variable True Answer Correct that is at least 5 years in length Incorrect that must be over 6 months in length Incorrect that must be between 6 months and 5 years Incorrect 22 In the long run all inputs are fixed Incorrect inputs are neither variable nor fixed Incorrect at least one input is variable and one input is fixed Incorrect all inputs are variable True Answer Correct 23 A curve that shows the quantities of output that can be obtained from different quantities of a variable input assuming other inputs are fixed is called the curve total input Incorrect marginal input Incorrect total product True Answer Correct average total quantity Incorrect 24 A total product curve indicates the relationship between a variable input and price Incorrect a variable input and variable cost Incorrect a variable input and output True Answer Correct output and price
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