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WorksheetsEcon COSTS AND REVENUE
Total questions: 15
Worksheet time: 8mins
The MC curve slopes the way it does in the short run because of........
Diseconomies of scale
Economies of scale
Rising total revenue
Falling average fixed cost
The law of diminishing marginal returns
The difference between average total cost and average variable cost falls as output rises because of
Falling marginal cost
Falling average fixed cost
Rising marginal cost
Rising average fixed costs
The law of diminishing marginal returns
The minimum point of the short run AC curve will always cross the......
Marginal cost curve
Average variable cost curve
Average fixed cost curve
Total cost curve
Total fixed cost curve
In economics the difference between the short run and the long run is......
In the long there is at least one fixed factor of production
All factors of production are variable in the long run
The short run only lasts for the first 6 months
In the short run all factors of production are fixed
In the short run all factors of production are variable
Marginal revenue can be defined as
revenue received from selling one extra unit of production
price x quantity
revenue - costs
total revenue divided by quantity
the change in total revenue
A firm reduces the price and total revenue rises. This means the good must be....
PED elastic
PED inelastic
YED elastic
XED inelastic
PES elastic
Supernormal profits are maximised when.....
AR=AC
MR>MC
MR=MC
AR>AC
TR is maximised
Normal profit is where.....
AR>AC
MR=MC
MR>MC
AR=AVC
AR=AC
The shutdown point in the short run is where.......
AR=AC
MR=MC
AR<AVC
AR>AVC
AR=AVC
A firm in the long run will shutdown when
AR=AC
AR>AC
MR=MC
AR<AC
AVC=AFC
A loss making firm will stay in the market in the short run if AR>AVC. The reason for this is......
They are paying a contribution to their fixed costs
They are paying off all their fixed costs
They are paying off all their variable costs
They are making supernormal profits
They are making normal profit
A profit maximising firm experiences an increase in rent. Assuming ceteris paribus, what happens to price, quantity and profit?
no change, no change, fall
fall, no change, fall
rise, rise, rise
no change, fall, fall
no change, no change, no change
Blake decides to set up a profit maximising hairdressing salon. Soon after the government announces an increase in the minimum wage. Assuming ceteris paribus, what happens to price, quantity and profit?
fall, rise, rise
fall, no change, no change
rise, fall, fall
fall, fall, fall
fall, rise, fall
Elena owns a large chain of gyms in the UK. A health awareness campaign promotes a large increase in the sale of gym memberships. Assuming ceteris paribus, what will happen to price, quantity and profits?
fall, fall, fall
rise, rise, fall
rise, rise, rise
fall, rise, rise
rise, fall, fall
What was confiscated from UK lorry drivers at a Dutch port earlier this week?
Bananas
Apples
Salmon
Ham and cheese sandwich
Tuna and cheese melt
