Micro Final Exam Review

What is an Indifference Curve?

• A graph that shows the relationship between a firm's output and the price of the product.

• A graph that shows the relationship between a consumer's utility and the quantity of two goods consumed.

• A graph that shows the relationship between a firm's costs and the level of production.

• A graph that shows the relationship between a firm's revenue and the level of production.

What is an Indifference Map?

• A map that shows the locations of firms in a particular industry.

• A map that shows the locations of consumers who purchase a particular product.

• A graph that shows the relationship between a consumer's budget and the price of a product.

• A collection of indifference curves that represent a consumer's preferences for different combinations of two goods.

What is Break-Even Analysis?

• An analysis that determines the level of output at which a firm earns zero economic profit.

• An analysis that determines the level of output at which a firm earns maximum economic profit.

• An analysis that determines the level of output at which a firm earns maximum revenue.

• An analysis that determines the level of output at which a firm earns maximum profit margin.

What is Technical Progress?

• A change in the quantity of output resulting from a change in all inputs.

• A change in the quantity of output resulting from a change in one input, holding all other inputs constant.

• A change in the technology used to produce a good or service.

• A change in the price of a good or service.

What is Total Cost (TC)?

• The cost of producing one additional unit of output.

• The cost of all inputs used in production.

• The cost of variable inputs used in production.

• The cost of fixed inputs used in production.

What is Variable Cost (VC)?

• The cost of producing one additional unit of output.

• The cost of all inputs used in production.

• The cost of variable inputs used in production.

• The cost of fixed inputs used in production.

What is Fixed Cost (FC)?

• The cost of producing one additional unit of output.

• The cost of all inputs used in production.

• The cost of variable inputs used in production.

• The cost of fixed inputs used in production.

What is Marginal Cost (MC)?

• The cost of producing one additional unit of output.

• The cost of all inputs used in production.

• The cost of variable inputs used in production.

• The cost of fixed inputs used in production.

What is Marginal Revenue (MR)?

• The additional revenue earned by a firm from selling one additional unit of output.

• The total revenue earned by a firm from selling all units of output.

• The revenue earned by a firm after deducting all costs.

• The revenue earned by a firm after deducting all variable costs.

The formula for calculating Average Total Cost (ATC) is:

• ATC = (FC + VC) / Q

• ATC = (FC - VC) / Q

• ATC = (Q+ VC) / FC

• ATC = (FC + VC) * Q