Question

PRINT LAST NAME, VIRST NAME A firm's ability to earn large profit is constrained by: Costs that must be paid in the short run even when no output is produced are called: NAME THE COSTS OF PRODUCTION SECTION 1 b. C. d. the technology or production techniques available the prices of inputs used by the firm the market price of the good or service sold by the firm. All of the above b. c. d. total costs (TC). total fixed costs (TFC). total variable costs (TVC). marginal costs (MC) In the short run, average variable cost can be obtained by each of the following except: ATC - MC. ATC - AFC. (TC/Q) - (TFC/Q). TVC/Q. b. c. d. 0 Marginal cost (MC) is: a. b. c. d. All of the above the change in total cost (TC) divided by the change in output (Q. the change in total variable cost (TVC) divided by the change in output (0) not affected by the level of fixed costs. 5. b. c. d. Costs that change as the level of output changes are called: overhead. variable costs. fixed costs. sunk costs. a. Which of the following is true for a firm in the short run? TVC = TC - TFC b. TC - TVC + TFC TFC - TC - TVC d. All of the above are true c. 7 a. Suppose through 40 basketball games Dirk Nowitzki scored, on average, 25 points per game. If in his 41* game Dirk scored 28 points, we know that his: marginal score is greater than his average score, and his season average will fall. b. marginal score is greater than his average score, and his season average will rise. marginal score is less than his average score, and his season average will fall. d. marginal score is less than his average score, and his season average will rise. c. 79 Chapter 10 Assignments

Answer 1

Solution:

2) ans: (b) Total fixed cost.

Reason: Fixed costs are indirect costs and have to be paid irrespective of the level of production. Even if zero output is being produced these costs have to be incurred.

3) ans: (a) ATC - MC

Reason: ​​​​​​This formula used to calculate "no profit no gain" situation.

​​​​​​4) ans: (d) all of the above

Reason: marginal cost is calculated by Change is total cast ÷ change in output quantity. So option "a" is correct. And we know when we produce 1 unit then we incurred variable cost. fixed cost is always fixed irrespective of production so option "b" & "c" also correct.

6) ans: (d) all of the above

Reason: TC = TFC+TVC. and in all the first 3 option this formula is written with different combinations but answer is same in all of the above . So ans is all of the above.

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