1. Which of the following is most likely a long-run decision for a firm? A) The
ID: 1253614 • Letter: 1
Question
1.
Which of the following is most likely a long-run decision for a firm?
A) The hours a store should stay open.
B) How many warehouses to build.
C) The number of workers to hire.
D) The price at which to sell the product.
2.
If a product is "labor intensive", it means that the product requires a large amount of labor in the production process. Why might an American firm have labor intensive products made in another country?
A) American workers cannot be trusted to make the product
B) American workers will be paid less than foreign workers
C) American labor is relatively expensive compared to foreign labor
D) Most of the product will be sold in other countries, so the firm is better off when the good is already produced in other countries.
3.Refer to Table A. This table shows 4 production methods, A, B, C, and D, that all produce an output level of Q = 2,000 pizzas per week. If the cost of labor is $20 per worker and the implicit cost of capital is $40 per unit, which production technique minimizes the costs of producing the pizzas?
A) A
B) B
C) C
D) D
E) All of the techniques have the same cost since they produce the same Q = 2,000 output.
4.Refer to Table B. The accounting costs for this firm are
A) $9,950
B) $6,550
C) $16,000
D) $5,000
E) $5,950
In Table C, what is the APL when 6 workers are hired?
Explanation / Answer
B C C B C D E A B E E C
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