AP Microeconomics Production Costs

Front

According to the graph, increasing returns occur from

Back

0 to Labor₁

Front

The following graph illustrates: The Law of Increasing Costs, The Law of Demand, Circular Flow Diagram of  Mixed Economy, The Marginal Product of Labor

Back

The Marginal Product of Labor

Front

What reason allows increasing returns to occur with production as one assess the labor factor only? Options: increasing costs, worker specialization, underutilization, fixed resources

Back

worker specialization

Front

Cameron opens up a hot chocolate stand for two hours. He spends $10 for ingredients and sells $60 worth of tasty beverages. In the same two hours, he could have provided Uber services (illegally because he isn't 18) and earned $40. Camerons accounting profit is ____ and an economic profit of ____.

Back

$50, $10

Front

Which description fits the total-cost curve when the marginal product of labor diminishes? Options: They are linear., The slope increases as output increases., The slope decreases as input increases., The curve is a parabolic inverse "u" that contains a peak.

Back

The slope increases as output increases.

Front

Which description fits the fixed cost curve when the marginal product of labor diminishes? Options: It is linear., The slope increases as output increases., The slope decreases as input increases., The curve is a parabolic inverse "u" that contains a peak.

Back

It is linear.

Front

The marginal cost curve typically does which of the following? Options: Increases at a fixed rate., Decreases and eventually increases., Decreases at a decreasing rate., Increases and eventually decreases.

Back

Decreases and eventually increases.

Front

Shutdown of a firm occurs when _______ is _______ price in the short run.

Back

AVC is greater than

Front

Which output level would be the efficient scale? Options: Qo, Q1, Q2, Q3

Back

Q3

Front

Which output level would MC be equal to MR and MR equal to lowest minimal cost? Options: Qo, Q1, Q2, Q3

Back

Q3