Chap 14

Accounting profit is equal to total revenue minus _______.

• implicit costs

• explicit costs

• the sum of implicit and explicit costs

• marginal costs

• variable costs

Economic profit is equal to total revenue minus _______.

• implicit costs

• explicit costs

• the sum of implicit and explicit costs

• marginal costs

• variable costs

If there are implicit costs of production, _______.

• accounting profit will always be zero

• economic profit will exceed accounting profit

• accounting profit will exceed economic profit

• economic profit and accounting profit will be equal

• economic profit will always be zero

If a production function exhibits diminishing marginal product, its slope _______.

• could be any of the answer choices

• is linear (a straight line)

• becomes steeper as the quantity of the input increases

• becomes flatter as the quantity of the input increases

If a production function exhibits diminishing marginal product, the slope of the corresponding total-cost curve _______.

• is linear (a straight line)

• could be any of the answer choices

• becomes flatter as the quantity of output increases

• becomes steeper as the quantity of output increases

The marginal product of labor as production moves from employing one worker to employing two workers is _______.

• 0

• 20

• 34

• 46

• 80

The production process described above shows _______.

• increasing returns to scale

• decreasing returns to scale

• constant marginal product of labor

• increasing marginal product of labor

• diminishing marginal product of labor

The average fixed cost of producing four units is _______.

• $52

• $20

• $10

• $5

• none of the answer choices

The average total cost of producing three units is ___.

• $6.67

• $12

• $18.67

• $36

• $52

The marginal cost of changing production from three units to four units is _______.

• $10

• $12

• $14

• $16

• $18