A. be flat (horizontal)
B. slope upward
C. slope downward
D. be U-shaped.
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When marginal costs are below average total costs ?
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Which of the following statements is true ?
A. average fixed cost is rising
B. average total cost is falling
C. average total cost is raising
D. average total cost is minimized
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If a production function exhibits diminishing marginal product. its slope ?
A. All costs are fixed in the short run.
B. All costs are variable in the long run
C. All costs are variable in the short run
D. All costs are fixed in the long run
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Naila owns a small pottery factory. She can make 1000 pieces of pottery per year and sell them for Rs 100 each. It costs Naila Rs 20,000 for the raw materials to produce the 1,000 pieces of pottery She has invested Rs100,000 in her factory and equipment: Rs50,000 from her savings and Rs50,000 borrowed at 10 per cent. (Assume that she could have loaned her money out at 10 her per cent, too) Naila can work at a competing pottery factory for Rs40,000 per year. The economics profit at Naila’s pottery factory is ?
A. is linear (a straight line)
B. becomes steeper as the quantity of the input increase
C. could be any of these answers
D. becomes flatter as the quantity of the input increase
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Economic profit is equal to total revenue minus ?
A. Rs80,000
B. Rs30,000
C. Rs75,000
D. Rs70,000
0
The efficient scale of production is the quantity of output that minimizes ?
A. variable costs
B. implicit costs
C. explicit costs
D. marginal costs
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In the long run, if a very small factory were to expand its scale of operations it is likely that it would initially experience ?
A. average fixed cost
B. average total cost
C. average variable cost
D. marginal cost
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If marginal costs equal average total costs ?
A. an increase in average total costs
B. diseconomies of scale
C. economies of scale
D. constant returns to scale