HCM 402 Module 8 Quiz

question

Which of the following should typically be ignored because spending has already been made and cannot be changed?

variable costs

sunk costs

marginal costs

average marginal cost

answer

sunk costs

question

If a comparison between average cost and price reveals whether a firm is earning profits, then a comparison between average variable cost and price reveals

that if the market price exceeds average cost, profits will be positive.

that if the market price is below average cost, then profits will be negative.

total revenues are the quantity produced multiplied by the price.

whether the firm is earning profit if fixed costs are left out of the calculation.

answer

whether the firm is earning profit if fixed costs are left out of the calculation.

question

The graph above illustrates the electricity market. Consider market competition between firms where price is based on AR and select the most appropriate answer.

in the short-run, the demand curve and average revenue shift as other firms enter the market and increase competition

in the short-run, the demand curve and average revenue shift as other firms leave the market and decrease competition

in the long-run, the demand curve and average revenue shift as other firms enter the market and increase competition

in the long-run, the demand curve and average revenue shift as other firms leave the market and decrease competition

answer

in the long-run, the demand curve and average revenue shift as other firms enter the market and increase competition

question

Fixed costs are important because, at least in the ___________, the firm _______________.

long run; cannot alter them

short run; cannot alter them

long run; can alter them

short run; can alter them

answer

short run; cannot alter them

question

In order to determine the average variable cost, the firm's variable costs are divided by _______________________.

its' fixed costs

the quantity of output

its' average costs

diminishing marginal costs

answer

the quantity of output

question

The marginal cost curve is generally ______________, because diminishing marginal returns implies that additional units are ________________________.

A. downward-sloping; more costly to produce

B. upward-sloping; more costly to produce

C. downward-sloping; less costly to produce

D. upward-sloping; less costly to produce

answer

B. upward-sloping; more costly to produce

question

Economies of scale may arise from all but one of the following. Which one is it?

doubling promotional expenses to expand sale more than proportionately

having a larger retail space can expand sales more than proportionately

spreading the fixed-costs of administration over more customers holds average costs down

government economic subsidies protect firms from competition to avoid losses.

answer

government economic subsidies protect firms from competition to avoid losses.

question

_____________ is calculated by taking the quantity of everything that is sold and multiplying it by the sale price.

Total revenue

Total profits

Average profit margin

Total cost

answer

total revenue`

question

Refer to the graph shown above. Based on the information illustrated in the graph, which of the following is correct?

marginal cost line must intersect the average cost line at the middle point of the average cost curve

marginal cost of production is below the average cost for producing previous units

producing one more unit is reducing average costs overall

producing a marginal unit is increasing average costs overall

answer

producing a marginal unit is increasing average costs overall

question

Refer to the table below. If this information were used to create a total cost graph, the curve should

begin at 40 on the vertical axis and slope upward.

become steeper as quantity increases.

become steeper due to diminishing returns.

reflect all of the above.

answer

reflect all of the above.

question

A situation where the level of output, scale and average costs are all rising is called

decreasing returns to scale

diseconomies of scale

diminishing returns to scale

both a and b are correct

answer

both a and b are correct

question

If a solar panel manufacturer wants to look at its total costs of production in the short run, which of the following would provide a useful starting point?

divide total costs into two categories: variable costs that can't be changed in the short run and fixed costs that can be

divide the total costs of production by the quantity of output

divide the variable costs of production by the quantity of output

divide total costs into two categories: fixed costs that can't be changed in the short run and variable costs that can be

answer

divide total costs into two categories: fixed costs that can't be changed in the short run and variable costs that can be

question

According to the definition of profit, if a profit-maximizing firm will always attempt to produce its desired level of output at the lowest possible cost, then it will

do so regardless of what type of competition exists in a market.

take a long-run perspective on costs, when such costs cannot be adjusted.

take a short-run perspective on labor costs which cannot be immediately changed.

breakdown its cost structure according to short-run adjustments.

answer

do so regardless of what type of competition exists in a market.

question

The ______________ of all firms can be broken down into some common underlying patterns.

total revenues

diminishing short-run costs

cost structure

diminishing long-run costs

answer

cost structure

question

In order to determine ____________, the firm's total costs must be divided by the quantity of its output.

diminishing marginal returns

fixed costs

variable cost

average cost

answer

average cost

question

Marcella operates a small, but very successful art gallery. All but one of the following can be classified as a variable cost arising from the physical inputs Marcella requires to operate her business. Which is it?

physical space for the gallery

costs of purchasing art work to sell in the gallery

wages paid to three part-time employees

accountant's fees for preparing tax returns

answer

physical space for the gallery

question

Approximately what percentage of the US labor force is employed by firms that have fewer than 100 employees?

63%

50%

45%

35%

`

answer

35%

question

In economics, a firm that faces no competitors is referred to as _________________.

an oligopoly

a monopoly

a perfect competitor

an oligopolizor

answer

monopoly

question

______________ include all of the costs of production that increase with the quantity produced.

Fixed costs

Variable costs

Average costs

Average variable costs

answer

Variable costs

question

A firm's ___________ consist of expenditures that must be made before production starts that typically, over the short run, _______________ regardless of the level of production.

fixed costs; do not change,

variable costs; are constantly changing,

fixed costs; are consistently changing,

variable costs; do not change,

answer

fixed costs; do not change,

1 of 20

question

Which of the following should typically be ignored because spending has already been made and cannot be changed?

variable costs

sunk costs

marginal costs

average marginal cost

answer

sunk costs

question

answer

whether the firm is earning profit if fixed costs are left out of the calculation.

question

answer

in the long-run, the demand curve and average revenue shift as other firms enter the market and increase competition

question

answer

short run; cannot alter them

question

answer

the quantity of output

question

answer

B. upward-sloping; more costly to produce

question

answer

government economic subsidies protect firms from competition to avoid losses.

question

_____________ is calculated by taking the quantity of everything that is sold and multiplying it by the sale price.

Total revenue

Total profits

Average profit margin

Total cost

answer

total revenue`

question

answer

producing a marginal unit is increasing average costs overall

question

answer

reflect all of the above.

question

A situation where the level of output, scale and average costs are all rising is called

decreasing returns to scale

diseconomies of scale

diminishing returns to scale

both a and b are correct

answer

both a and b are correct

question

answer

divide total costs into two categories: fixed costs that can't be changed in the short run and variable costs that can be

question

answer

do so regardless of what type of competition exists in a market.

question

The ______________ of all firms can be broken down into some common underlying patterns.

total revenues

diminishing short-run costs

cost structure

diminishing long-run costs

answer

cost structure

question

In order to determine ____________, the firm's total costs must be divided by the quantity of its output.

diminishing marginal returns

fixed costs

variable cost

average cost

answer

average cost

question

answer

physical space for the gallery

question

Approximately what percentage of the US labor force is employed by firms that have fewer than 100 employees?

63%

50%

45%

35%

`

answer

35%

question

In economics, a firm that faces no competitors is referred to as _________________.

an oligopoly

a monopoly

a perfect competitor

an oligopolizor

answer

monopoly

question

______________ include all of the costs of production that increase with the quantity produced.

Fixed costs

Variable costs

Average costs

Average variable costs

answer

Variable costs

question

answer

fixed costs; do not change,

Continue to order Get a quote

HCM 402 Module 8 Quiz

Recent Posts

Recent Comments

Calculate the price of your order

Our guarantees

Money-back guarantee

Zero-plagiarism guarantee

Free-revision policy

Privacy policy

Fair-cooperation guarantee