WorksheetsUnit 3 - economics
Total questions: 12
Worksheet time: 9mins
Name
Class
Date
1.
The marginal product of labor is equal to
a)
the additional labor required to produce one more unit of output.
b)
average product when average product is at a minimum.
c)
the additional output produced by hiring one more unit of labor.
d)
the slope of a ray drawn from the origin to a point on the total product curve.
2.
An isoquant that is
a)
further from the origin represents greater output.
b)
flatter represents the trade-offs between inputs that are poor substitutes.
c)
negatively sloped represents input combinations associated with Stage I of production.
d)
All of the above are correct.
3.
An isocost line will be shifted further away from the origin
a)
if the prices of both inputs increase.
b)
if total cost increases.
c)
if there is an advance in technology.
d)
All of the above are correct.
4.
Stage II of production begins at the point
a)
of inflection of the total product curve.
b)
where average and marginal product are equal.
c)
where total product is at a maximum.
d)
where marginal product is at a maximum.
5.
The short run is a time period in which:
a)
all resources are fixed.
b)
the level of output is fixed.
c)
the size of the production plant is variable
d)
some resources are fixed and others are variable.
6.
The law of diminishing returns states that:
a)
as a firm uses more of a variable resource, given the quantity of fixed resources, Page 2 the average product of the firm will increase.
b)
as a firm uses more of a variable resource, given the quantity of fixed resources, marginal product of the firm will eventually decrease.
c)
in the short run, the average total costs of the firm will eventually diminish.
d)
in the long run, the average total costs of the firm will eventually diminish.
7.
When a firm doubles its inputs and finds that its output has more than doubled, this is known as:
a)
economies of scale.
b)
constant returns to scale.
c)
diseconomies of scale.
d)
a violation of the law of diminishing returns.
8.
Which of the following short-run cost curves declines continuously?
a)
Average total cost
b)
Marginal cost
c)
Average fixed cost
d)
Average variable cost
9.
Breakeven analysis identifies the
a)
profit-maximizing level of output.
b)
level of output where economic profit is equal to zero.
c)
level of output where marginal revenue is equal to marginal cost.
d)
All of the above are correct.
10.
The slope of the total cost curve is:
a)
the marginal cost.
b)
the average product
c)
the marginal product.
d)
the fixed product.
11.
The Marginal Cost curve usually
a)
Is J-shaped
b)
Cuts through the minimum of the average variable cost curve
c)
Cuts through the minimum of the average total cost curve
d)
All of the above are correct.
12.
Dimishining returns may follow
a)
Quantity of labour is fixed
b)
Quantity of output is fixed
c)
Quantity of capital is fixed
d)
Quantity of any one factor is fixed
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