Production Quiz

What does the production function describe?

• The demand for products

• The relationship between inputs and outputs

• The marketing strategy

• The cost of production

In the short run, which type of input cannot be varied?

• Labor input

• Fixed input

• Capital input

• Variable input

What is the law of diminishing returns?

• Output decreases with more input

• Output remains constant with more input

• Output increases at a decreasing rate with more input

• Output increases indefinitely with more input

What is the average product of a variable input?

• Total input divided by the quantity of output

• Marginal product divided by total product

• Total product divided by fixed input

• Total output divided by the quantity of that input

What does an isoquant represent?

• The average product of inputs

• The total cost of production

• The set of all input combinations for a given output level

• The marginal cost of production

What are increasing returns to scale?

• Output decreases with input increases

• Output remains constant with input increases

• Output increases more than proportionally to input increases

• Output increases less than proportionally to input increases

What is the marginal rate of technical substitution (MRTS)?

• The average product of all inputs

• The fixed cost of production

• The total output produced by all inputs

• The rate at which one input can be substituted for another

In the long run, what is true about all factors of production?

• Some factors are fixed and some are variable

• All factors are fixed

• Only labor is variable

• All factors are variable