C4: Production & Cost_UTMspace

What does “production” mean in economics?

• Selling goods

• Using inputs to create outputs

• Buying raw materials

• Transporting goods

Which of the following is a fixed input in a coffee shop like ZUS or Luckin?

• Coffee beans

• Barista wages

• Rental

• Electricity bill

If Mixue increases its labour force while keeping its equipment constant, which law applies?

• Law of supply

• Law of diminishing marginal returns

• Law of demand

• Law of increasing returns

In the short run, which input is typically fixed?

• Labour

• Raw materials

• Capital

• Electricity

What is the formula for Average Product (AP)?

• AP = TP × Labour

• AP = TP / Labour

• AP = Labour / TP

• AP = TP + Labour

If a thrift store in Melaka hires too many staff and productivity drops, it’s experiencing:

• Increasing returns

• Constant returns

• Negative returns

• Marginal returns

What does “returns to scale” refer to in the long run?

• Change in price

• Change in output due to change in all inputs

• Change in labour only

• Change in fixed cost

If Montigo doubles its inputs and triples its output, it experiences:

• Constant returns to scale

• Decreasing returns to scale

• Increasing returns to scale

• Diseconomies of scale

Which cost is incurred even when a mobile gaming café has zero customers?

• Variable cost

• Marginal cost

• Fixed cost

• Opportunity cost

What is the formula for Total Cost (TC)?

• TC = TFC × TVC

• TC = TFC + TVC

• TC = TVC – TFC

• TC = TFC / TVC