compared to a firm that has many small plants, a firm with a few large plants is likely to have all of the following except which one?
A. less managerial diseconomies
B. fewer inputs
C. greater managerial diseconomies
D. greater availability of specialized capital correct answers greater manage...
Econ402 test3 sang lee || All Correct.
compared to a firm that has many small plants, a firm with a few large plants is likely to have all
of the following except which one?
A. less managerial diseconomies
B. fewer inputs
C. greater managerial diseconomies
D. greater availability of specialized capital correct answers greater managerial diseconomies
If a firm with two large plants installs a large, custom built assembly line in each of its plants, the
custom assembly line is an example of ______. correct answers specialized capital
All of the following are true regarding managerial diseconomies except which one?
A. They can increase as a firm adds more plants.
B. They can increase as a firm expands its scope of operations.
C. They affect a firm's total profit.
D. They cause an increase in a firm's total profit. correct answers they cause an increase in a
firms total profit
Happy Cows is a dairy farm that is currently earning $20,000 in economic profit. The managers
of Happy Cows are considering adding a second dairy farm; however, the managerial
diseconomies from adding the second farm cause Happy Cows current farm's economic profit to
fall to $15,000. It is economically sound for Happy Cows to add the second farm if ________.
A. the second farm's economic profit exceeds $5,000
B. the second farm's economic profit is at least $4,000
C. the second farm's economic profit is less than $5,000
D. the second farm's economic profit is at least $4,800 correct answers the 2nd farms economic
profit exceeds $5000.
View Your World, a highminus−end window manufacturer, directly pays all of the transaction
costs. The managers of View Your World are considering the profitminus−maximizing location
for their plant. If locating the plant closer to its customers saves $10,000 in transportation costs
of its windows to its customers, but causes an additional $7,500 in input transportation costs,
View Your World ________ locate its plant closer to its customers as the marginal benefit is
________ than the marginal cost.
A. should; less
B. should not; more
C. should not; less
D. should; greater correct answers should; greater
A plant is located at the
costminus−minimizing
location when the marginal benefit of moving closer to the inputs is ________ the marginal cost.
correct answers equal to
, A firm has two plants, one located in desirable Scenic Springs and the other located in the
undesirable Swamp Lands. If the workers in Scenic Springs are paid $50,000 a year and the
workers in Swamp Land are paid $60,000, which of the following is true?
A.The $10,000 difference in salaries is the worker equity payment.
B.The $60,000 salary is a compensating wage differential.
C.The $10,000 difference in salaries is the compensating wage differential.
D.The $60,000 salary is a worker equity payment. correct answers the $10,000 difference is the
compensating wage differential
All of the following costs will vary depending on the geographic location of a firm's plant except
which one?
A.real estate values
B.zoning issues
C.Federal employee taxes
D.traffic regulations involving large trucks correct answers federal employee taxes
If a firm is not directly paying all of the transportation costs, managers still have an incentive to
minimize the sum of the production and transportation costs. T/F? correct answers true
Suppose a firm has two plants, and for each quantity the MC and ATC in one plant are half that
in the other plant. To maximize its profit, the managers should use only the lowdash-cost plant
when the firm produces its output.
A.True
B.False correct answers false
When a multidash-plant firm maximizes its profit, the marginal cost of the last unit produced in
each plant is equal across all plants.
A.True
B.False correct answers true
Suppose Amazon is determining where to locate a new warehouse, from which it will ship
products to customers. Focusing only on transportation costs, if Amazon pays the costs of
shipping the products to the warehouse and also pays the cost of shipping the products to its
customers, Amazon will locate the warehouse
i. midway between its customers and the locations from which the products are shipped.
ii. where the marginal cost of moving closer to the customers equals the marginal benefit of
moving closer to the customers.
A.Only ii is correct.
B.Both i and ii are correct.
C.Neither i nor ii is correct.
D.Only i is correct. correct answers only ii is current
Suppose a firm pays all of the costs of transporting its inputs to its plant and customers pay all of
the costs of transporting the finished product from the plant. The marginal cost of moving a plant
closer to the source of the inputs is the ____ and the marginal benefit is the ____.
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