Reading 17: Output and Costs - LOS b ～ Q1-5 product, style, black, class, input

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1.If the last unit of input increases total product we know that the marginal product of that input is:

A)   negative.

B)   positive.

C)   increasing.

D)   falling.

2.Which of the following most accurately describes the condition that typically exists when marginal product is at a maximum?

A)   Marginal cost is at a minimum.

B)   Average product is at a minimum.

C)   Average variable cost is increasing.

D)   Average variable cost is at a minimum.

3.Which of the following most accurately describes the typical relationship between marginal product (MP) and average product (AP)? As the quantity of labor increases:

A)   initially, AP < MP, then AP = MP, then AP > MP.

B)   initially, AP = MP, then AP > MP.

C)   AP is always less than MP.

D)   initially, AP > MP, then AP = MP, then AP < MP.

4.Assume that output increased from 1,550 to 1,850 units per day as a result of increasing labor from 200 to 210 workers. The marginal product of labor is closest to:

A)   1.55 units per day per worker.

B)   30 units per day per worker.

C)   1.25 units per day per worker.

D)   300 units per day per worker.

5.Which of the following conditions is most likely to exist for a typical production process when average product is at its maximum?

A)   Marginal product is increasing.

B)   Marginal product is at a minimum.

C)   Marginal cost is at a minimum.

D)   Average variable cost is at a minimum.

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答案和详解如下：

1.If the last unit of input increases total product we know that the marginal product of that input is:

A)   negative.

B)   positive.

C)   increasing.

D)   falling.

The correct answer was B)

As long as marginal product is positive, total product will increase. We would need more information to determine whether marginal product is falling or increasing.

2.Which of the following most accurately describes the condition that typically exists when marginal product is at a maximum?

A)   Marginal cost is at a minimum.

B)   Average product is at a minimum.

C)   Average variable cost is increasing.

D)   Average variable cost is at a minimum.

The correct answer was A)

Marginal product is at a maximum when marginal cost is at a minimum. At the corresponding labor and output levels, average variable cost is decreasing and average product in increasing.

3.Which of the following most accurately describes the typical relationship between marginal product (MP) and average product (AP)? As the quantity of labor increases:

A)   initially, AP < MP, then AP = MP, then AP > MP.

B)   initially, AP = MP, then AP > MP.

C)   AP is always less than MP.

D)   initially, AP > MP, then AP = MP, then AP < MP.

The correct answer was A)

MP intersects the AP minimum from above. MP is initially greater than average product, and then MP and AP intersect. Beyond this intersection, MP is less than AP. (Hint: sketch the curves.)

4.Assume that output increased from 1,550 to 1,850 units per day as a result of increasing labor from 200 to 210 workers. The marginal product of labor is closest to:

A)   1.55 units per day per worker.

B)   30 units per day per worker.

C)   1.25 units per day per worker.

D)   300 units per day per worker.

The correct answer was B)

Marginal product is the additional output per additional unit of an input (labor). Since output changed by 300 units and labor changed by 10 workers, the marginal product is 300 / 10 = 30 units per day per worker.

5.Which of the following conditions is most likely to exist for a typical production process when average product is at its maximum?

A)   Marginal product is increasing.

B)   Marginal product is at a minimum.

C)   Marginal cost is at a minimum.

D)   Average variable cost is at a minimum.

The correct answer was D)

When average product is at a maximum, average variable cost is at a minimum. At the corresponding labor and output level, marginal product is decreasing and marginal cost is increasing.

jingh1981

thanks

gaoflex

thank you.