1) If the average product of 14 workers is 50 bushels of wheat and the average...

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1) If the average product of 14 workers is 50 bushels of wheat and the average...

1) If the average product of 14 workers is 50 bushels of wheat and the average product of 15 workers of wheat is 55 bushels of wheat, then the marginal product of the 15th worker was ___________ bushels of wheat. So What is _____?

2) Which of the following is most likely to be a fixed cost for a bakery firm?

A)Wages paid to workers

B)Paying for ingredients from a food supplier

C)The monthly electricity bill

D)Paying rent each month for an unowned building

3) Suppose that when the level of output for the firm increases from 28 to 29 units, its total costs increase from $120 to $155. What is the firm's marginal cost per unit?

4) If fixed costs of a firm increase, what will happen?

A) total costs will increase, and total variable costs will increase

B) average total costs will increase, and average variable costs will decrease

C) average total costs will increase, and average variable costs will not change

D) total variable costs will increase, and average variable costs will increase

5) As a firm continues to produce additional output, which of the following is constant as output increases?

A) total variable costs

B) marginal costs

C) average fixed costs

D) total fixed costs

6) If the marginal cost is currently below the average total cost (ATC), what will happen to ATC as more output is produced?

A) ATC will rise

B) ATC will fall

C) ATC could rise or fall

ATC could rise or fall

business economics

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Answer 1

Answer #1

1.Ans: The marginal product of the 15th worker was 125 bushels of wheat.

Explanation:

Total product of 14 workers = 14*50 = 700 bushels of wheat.

Total product of 15 workers = 15*55 = 825 bushels of wheat.

Marginal Product = Change in total product / Change in number or workers

= ( 825 - 700 ) / ( 15 - 14 ) = 125 / 1 = 125 bushels of wheat.

2.Ans: D) Paying rent each month for an unowned building

Explanation:

Fixed costs remain constant throughout the subsequent level of production. It is available even at zero level of output.

3.Ans: Firm's marginal cost per unit is $35

Explanation:

Marginal cost = Change in total cost / Change in quantity of output

= ( 155 - 120 ) / ( 29 -28 ) = 35 / 1 = $35

4.Ans: C) average total costs will increase, and average variable costs will not change

5.Ans: D) total fixed costs

Explanation:

Fixed costs remain constant throughout the subsequent level of production. It does not depend upon the level of output.

6.Ans: A) ATC will rise

Explanation:

When the marginal cost is currently below the average total cost (ATC) then ATC will decrease. As more output is produced then the ATC will start to increase because marginal cost is more than the ATC.

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Answer 2

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