Business Environment for Managerial Decision Making Quiz 2

What type of production function exhibits constant returns to scale?

• Cobb-Douglas

• Linear

• Exponential

• Quadratic

In a Cobb-Douglas production function, what are the sum of the exponents for labor and capital?

• 0

• 1

• 2

• 3

Which cost concept represents the additional cost of producing one more unit of output?

• Total cost

• Average cost

• Marginal cost

• Fixed cost

What type of returns to scale occurs when output increases proportionally more than inputs?

• Increasing returns to scale

• Constant returns to scale

• Decreasing returns to scale

• Economies of scale

Which market structure is characterized by a single seller?

• Perfect competition

• Monopoly

• Oligopoly

• Monopolistic competition

Which market structure is characterized by a single buyer?

• Perfect competition

• Monopoly

• Monopolistic competition

• Monopsony

What determines price and output decisions in perfect competition?

• Market demand only

• Market supply only

• Market demand and supply

• Government regulations

Which market structure is characterized by many firms selling similar but not identical products?

• Perfect competition

• Monopoly

• Oligopoly

• Monopolistic competition

What term describes the situation where a few large firms dominate an industry?

• Perfect competition

• Monopoly

• Oligopoly

• Monopolistic competition

Which cost remains constant regardless of the level of output in the short run?

• Total cost

• Variable cost

• Average cost

• Fixed cost