Fundamentals of Economics - Chapter 3
Self Assessment Quiz 2024
1. The total variable cost of producing 200 units equals
a. $125
b. $250
c. $350
d. $400 - Correct Answer a. $125
2. A production process has constant economies of scale if
a. average total cost does not change as production increases.
b. average total cost decreases as production increases.
c. average total cost increases as production increases.
d. average total cost increases as production decreases. - Correct Answer a. average total cost does not change as production increases.
3. According to the table, what is the marginal cost of producing the 20th unit?
a. $130
b. $60
c. $6
d. $30
e. $6.5 - Correct Answer c. $6
4. The accountants hired by Truscott & Associates have calculated that at the company's current production level, total fixed costs to equal $21,000, total variable costs to equal $42,000 and total revenue to equal $45,000. Because of this information, Truscott & Associates decide
a. to exit the industry.
b. to shut down.
c. to stay open because shutting down would be more expensive.
d. to stay open because they are making an economic profit. - Correct Answer c. to stay open because shutting down would be more expensive.
Self Assessment Quiz 2024
1. The total variable cost of producing 200 units equals
a. $125
b. $250
c. $350
d. $400 - Correct Answer a. $125
2. A production process has constant economies of scale if
a. average total cost does not change as production increases.
b. average total cost decreases as production increases.
c. average total cost increases as production increases.
d. average total cost increases as production decreases. - Correct Answer a. average total cost does not change as production increases.
3. According to the table, what is the marginal cost of producing the 20th unit?
a. $130
b. $60
c. $6
d. $30
e. $6.5 - Correct Answer c. $6
4. The accountants hired by Truscott & Associates have calculated that at the company's current production level, total fixed costs to equal $21,000, total variable costs to equal $42,000 and total revenue to equal $45,000. Because of this information, Truscott & Associates decide
a. to exit the industry.
b. to shut down.
c. to stay open because shutting down would be more expensive.
d. to stay open because they are making an economic profit. - Correct Answer c. to stay open because shutting down would be more expensive.
