Econ Quiz 5.1-5.3

If supply is elastic

• it is easier to predict changes in demand.

• producers respond slowly to changes in demand.

• it is unaffected by changes in price.

• it reacts strongly to changes in price.

Why would the supply curve of a dog walking business be considered elastic?

• because it can hire workers quickly if the price rises

• because the supply of dog walking isn't easily expanded or reduced

• because the supply of dogs changes quickly

• all of the above

What factor might lead to the opening of several new pizzerias in a town?

• The price of a slice of pizza has gone up.

• The price of a slice of of pizza has gone down.

• The supply of pizza is inelastic.

• The cost of producing pizza has doubled.

A raise in the price of a product

• causes firms to decrease production.

• causes a decrease in supply.

• increases competition.

• decreases competition.

What is the tendency of suppliers to offer more of a good at a higher price?

• quantity supplied

• supply

• law of supply

• elasticity of supply

What is the level of output every firm strives for?

• when marginal revenue equals marginal cost

• when marginal revenue is greater than marginal cost

• when variable cost and marginal cost rise at the same rate

• when fixed cost and marginal cost are equal

A cost that rises or falls depending on how much is produced is a(n)

• fixed cost.

• variable cost.

• operating cost.

• labor cost.

Total cost is

• the cost of operating a facility, such as a store or factory.

• fixed costs plus variable costs.

• a level of production at which the marginal product of labor decreases as the number or workers increases.

• the change in output from hiring one additional unit of labor.

The cost of producing one more unit of a good is known as a(n)

• fixed cost.

• variable cost.

• operating cost.

• marginal cost.

The additional income from selling one more unit of a good, sometimes equal to price, is

• marginal revenue.

• increasing marginal returns.

• the marginal product of labor.

• a variable.