AME 101 -Midterm examination

The value of the next best alternative foregone. When resources are limited and there is more than one enterprise where farmer can invest. The value of one enterprise sacrificed is the cost producing another enterprise.

• Opportunity cost principle

• Comparison principle

• Time principle

• All of the above

What are the kinds of investments?

• Investments on operating inputs and investment on capital assets

• Investment on capital assets and liabilities

• A and B

• All of the above

What is the procedure to find the future value of a present sum, given the earning power (interest rate) of money and the frequency of compounding.?

• Compounding

• Interest

• Capital

• All of the above

What is the procedure where the present value of the future income?

• Compounding

• Interest

• Capital

• Discounting

A costs which do not change in magnitude as the amount of output produced changes and are incurred even when production is not undertaken.

• Fixed cost

• Variable cost

• Average cost

• All of the above

The costs that are incurred on variable inputs and hence vary with the level of production.

• Fixed cost

• Variable cost

• Average cost

• All of the above

It represents the functional relationship between output and total cost

• Functional cost

• Cost alone

• Cost function

• Not of the above

The costs incurred on all fixed inputs used in production.

• Total fixed cost

• Cost alone

• Cost function

• All of the above

Refers to the costs of variable input used in production and is computed by multiplying the amount of variable input by the price/ unit of input.

• Total fixed cost

• Total variable cost

• Cost function

• All of the above

It is the sum of TVC & TFC and are obtained by adding TVC and TFC for different output levels.

• Cost

• Total cost

• Marginal cost

• None of the above