1.Which of the following cost concepts is correctly defined? A. B. ATC = VC + FC

Question

1.Which of the following cost concepts is correctly defined?
A.
B. ATC = VC + FC
C. ATC = AVC + AFC
D. TC = AVC + AFC


2. A cost that does not depend on the quantity of output produced is called a:
A. marginal cost.
B. fixed cost.
C. variable cost.
D. average cost.


5. When a cherry orchard in Oregon adds an additional worker, the total cost of production increases by $24,000. Adding the worker increases total cherry output by 600 pounds. Therefore, the marginal cost of the last pound of cherries produced is:
A. $40.
B. $19.
C. $4,000.
D. $24,000.


6. Marginal cost can be calculated as:
A. ?TC/?Q, where TC is total cost and Q is output.
B. ?VC/?Q, where VC is variable cost and Q is output.
C. the slope of the total cost curve.
D. ?TC/?Q, where TC is total cost and Q is output; ?VC/?Q, where VC is variable cost and Q is output; and as the slope of the total cost curve.


10. The average total cost of producing cell phones in a factory is $20 at the current output level of 100 units per week. If fixed cost is $1,200 per week:
A. average fixed cost is $20.
B. total cost is $3,200.
C. variable cost is $2,000.
D. average variable cost is $8.


11. The ________ curve continually declines as more output is produced in the short run.
A. marginal cost
B. average variable cost
C. average fixed cost
D. average total cost

Explanation / Answer

C B D B C D

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