ECP 6705 - MODULE 3 NEWEST ACTUAL QUESTIONS
WITH DETAILED ANSWERS //VERIFIED//GRADED
A+//(100% CORRECT ANSWERS) /ALREADY
If the cost of each additional unit of labor is w, a firm
will employ additional
VMPL= w
When each additional unit of an input increases total
output by more than did the previous unit, the firm is
experiencing
increasing marginal returns.
Marginal Product of Capital (MPk) is given by:
MPk = ΔQ/ΔK
The downward-sloping portion of the VMPL defines the
demand for __________ by a profit maximizing firm. It
slopes downward due to ___________.
Page | 1
,labor; diminishing marginal returns
Suppose capital, K, is on the vertical axis and labor, L,
is on the horizontal axis in a graph. Which of the
following would be true if the price of labor, w,
increased?
The isocost line rotates clockwise
The sum of all variable and fixed costs is the firm's
_____.
cost function
When the price of labor rises, firms have a tendency to
use
less labor and more capital.
Which of the following describes the maximum output
that can be produced with a fixed set of inputs?
Q = F{K,L}, where K is capital and L is labor
Page | 2
,The ________ run is a period of time during which at
least one factor of production is fixed.
short
In a production function, the input that refers to
workers is called...
labor
What describes the maximum output that can be
produced with a fixed set of inputs?
Production function
The MPL of the 5th worker is 9 units, the MPL of the 6th
worker is 7 units and the MPL of the 7th worker is 4
units. This is an example of which of the following?
decreasing marginal returns
The ________ run is a period of time during which a
manager can change all factors of production.
long
Page | 3
, The value of the output produced by the last unit of a
particular input is called
value marginal product.
Which of the following defines the maximum amount of
output that can be produced with a given set of inputs?
total product
Which of the following defines the maximum amount of
output that can be produced with a given set of inputs?
Labor
Capital
Graphically, what is the distance between total cost (TC)
and variable cost (VC)?
fixed cost
Which of the following statements is correct?
Page | 4
WITH DETAILED ANSWERS //VERIFIED//GRADED
A+//(100% CORRECT ANSWERS) /ALREADY
If the cost of each additional unit of labor is w, a firm
will employ additional
VMPL= w
When each additional unit of an input increases total
output by more than did the previous unit, the firm is
experiencing
increasing marginal returns.
Marginal Product of Capital (MPk) is given by:
MPk = ΔQ/ΔK
The downward-sloping portion of the VMPL defines the
demand for __________ by a profit maximizing firm. It
slopes downward due to ___________.
Page | 1
,labor; diminishing marginal returns
Suppose capital, K, is on the vertical axis and labor, L,
is on the horizontal axis in a graph. Which of the
following would be true if the price of labor, w,
increased?
The isocost line rotates clockwise
The sum of all variable and fixed costs is the firm's
_____.
cost function
When the price of labor rises, firms have a tendency to
use
less labor and more capital.
Which of the following describes the maximum output
that can be produced with a fixed set of inputs?
Q = F{K,L}, where K is capital and L is labor
Page | 2
,The ________ run is a period of time during which at
least one factor of production is fixed.
short
In a production function, the input that refers to
workers is called...
labor
What describes the maximum output that can be
produced with a fixed set of inputs?
Production function
The MPL of the 5th worker is 9 units, the MPL of the 6th
worker is 7 units and the MPL of the 7th worker is 4
units. This is an example of which of the following?
decreasing marginal returns
The ________ run is a period of time during which a
manager can change all factors of production.
long
Page | 3
, The value of the output produced by the last unit of a
particular input is called
value marginal product.
Which of the following defines the maximum amount of
output that can be produced with a given set of inputs?
total product
Which of the following defines the maximum amount of
output that can be produced with a given set of inputs?
Labor
Capital
Graphically, what is the distance between total cost (TC)
and variable cost (VC)?
fixed cost
Which of the following statements is correct?
Page | 4
