Mid Term 2 Economics Practice Flashcard Questions

Front

Which of the following is considered a variable input in the short run?
Factory building, Machinery, Raw materials, Land

Back

Raw materials

Front

The law of diminishing marginal returns states that:

Back

Adding more of a variable input to a fixed input will eventually decrease marginal product

Front

Marginal Product (MP) is defined as:

Back

Change in total output divided by change in input

Front

If total product is increasing at an increasing rate, then marginal product is:

Back

Increasing

Front

Which of the following will cause the production function to shift upward? A decrease in labor, Better technology, Higher wages, Increase in fixed costs

Back

Better technology

Front

The average product of labor is calculated by:

Back

Total product divided by total labor

Front

Which is true in the short run? Options: All inputs are fixed, Only labor is variable, At least one input is fixed, All inputs are variable

Back

At least one input is fixed

Front

If MP is greater than AP, then:

Back

AP is rising

Front

Total cost is equal to: Fixed cost + Marginal cost, Variable cost + Marginal cost, Fixed cost + Variable cost, Fixed cost - Variable cost

Back

Fixed cost + Variable cost

Front

Marginal cost is calculated as:

Back

Change in total cost divided by change in output