1.Assume that Herbert Jones can produce a skateboard using 10 labor hours at a labor rate of $10 per hour and 6 equipment hours at a rate of $40 per equipment hour. Juan Cortez can produce an identical skateboard using 8 hours of labor at a rate of $15 per hour and 6 equipment hours at a rate of $50 per equipment hour. Which of the following most accurately describes the relative economic and technological efficiency of these two skateboard manufacturers?

A)   Jones is economically efficient and technologically inefficient.

B)   Jones is economically inefficient and technologically inefficient.

C)   Jones is economically efficient and technologically efficient.

D)   Jones is economically inefficient and technologically efficient.

2.Technological and economic efficiency are most accurately described by which of the following statements?

A)   An economic activity can not be both economically and technologically efficient.

B)   In order for an activity to be technologically efficient, it must be economically efficient.

C)   For a given level of output, technological efficiency uses the least amount of inputs whereas economic efficiency has lowest possible cost.

D)   For a given level of output, technological efficiency uses the least labor and economic efficiency uses the least capital.

3.Ken Brobeck and Alice Magnuson are discussing the use of technology in production. They state the following:

Brobeck: If a firm has an opportunity to increase both its output and revenue by adopting new technology, it should do so.

Magnuson: If a production process is economically efficient, it must also be technologically efficient.

Are Brobeck and Magnuson correct?

A)                                        Correct  Correct

B)                                        Incorrect       Correct

C)                                        Correct  Incorrect

D)                                        Incorrect       Incorrect

答案和详解如下：

1.Assume that Herbert Jones can produce a skateboard using 10 labor hours at a labor rate of $10 per hour and 6 equipment hours at a rate of $40 per equipment hour. Juan Cortez can produce an identical skateboard using 8 hours of labor at a rate of $15 per hour and 6 equipment hours at a rate of $50 per equipment hour. Which of the following most accurately describes the relative economic and technological efficiency of these two skateboard manufacturers?

A)   Jones is economically efficient and technologically inefficient.

B)   Jones is economically inefficient and technologically inefficient.

C)   Jones is economically efficient and technologically efficient.

D)   Jones is economically inefficient and technologically efficient.

Click for Answer and Explanation A)

Economic efficiency occurs when a given output is achieved at the lowest possible cost. The total cost for Jones is $340 per skateboard = (10 x $10) + (6 x $40). The total cost for Cortez is $420 per skateboard = (8 x $15) + (6 x $50). So, Jones is economically efficient. Jones is technologically inefficient because he uses the same equipment hours as Cortez, but more labor hours.

2.Technological and economic efficiency are most accurately described by which of the following statements?

A)   An economic activity can not be both economically and technologically efficient.

B)   In order for an activity to be technologically efficient, it must be economically efficient.

C)   For a given level of output, technological efficiency uses the least amount of inputs whereas economic efficiency has lowest possible cost.

D)   For a given level of output, technological efficiency uses the least labor and economic efficiency uses the least capital.

Click for Answer and Explanation C)

Technological efficiency exists when the least amounts of possible inputs are used to produce a given level of output. Economic efficiency is producing a given output at the lowest possible cost.

3.Ken Brobeck and Alice Magnuson are discussing the use of technology in production. They state the following:

Brobeck: If a firm has an opportunity to increase both its output and revenue by adopting new technology, it should do so.

Magnuson: If a production process is economically efficient, it must also be technologically efficient.

Are Brobeck and Magnuson correct?

Brobeck

Magnuson

A)                                        Correct  Correct

B)                                        Incorrect       Correct

C)                                        Correct  Incorrect

D)                                        Incorrect       Incorrect

Click for Answer and Explanation B)

Brobeck is incorrect. A firm must incur costs to employ new technology. The firm should do so only if the additional revenue from adopting the technology is greater than the increase in costs.

Magnuson is correct. A production process is technologically efficient if there is no process that uses less of one input without using more of another input to produce a particular level of output. A process is economically efficient if it produces a given output at the lowest possible cost. A process cannot be economically efficient unless it is technologically efficient.