ECO 202 Exam Questions And Answers 100% Pass

©BRIGHTSTARS EXAM SOLUTIONS 11/15/2024 11:57 AM 1 | P a g e ECO 202 Exam Questions And Answers 100% Pass Harvey quit his job at State University where he earned $45,000 a year. He figures his entrepreneurial talent or foregone entrepreneurial income to be $5,000 a year. To start the business, he cashed in $100,000 in bonds that earned 10 percent interest annually to buy a software company, Extreme Gaming. In the first year, the firm sold 11,000 units of software at $75 for each unit. Of the $75 per unit, $55 goes for the costs of production, packaging, marketing, employee wages and benefits, and rent on a building.Refer to the above information. The economic profits of Harvey's firm in the first year were: A. $155,000 B. $160,000 C. $220,000 D. $280,000 - answer$160,000 If a firm's revenues just cover all its opportunity costs, then: A. Normal profit is zero ©BRIGHTSTARS EXAM SOLUTIONS 11/15/2024 11:57 AM 2 | P a g e B. Economic profit is zero C. Total revenues equal its explicit costs D. Total revenues equal its implicit costs - answerEconomic profit is zero Marginal product of labor refers to the: A. Last unit of output produced by labor at the end of each period B. Increase in output resulting from employing one more unit of labor C. Total output divided by the number of labor employed D. Smallest unit of the output produced by labor - answerIncrease in output resulting from employing one more unit of labor 28. Suppose a firm sells its product at a price lower than the opportunity cost of the inputs used to produce it. Which of the following statements is definitely true? A. The firm will earn positive accounting and economic profits ©BRIGHTSTARS EXAM SOLUTIONS 11/15/2024 11:57 AM 3 | P a g e B. The firm will face accounting and economic losses C. The firm will face an accounting loss, but earn positive economic profits D. The firm may earn positive accounting profits, but will face economic losses - answerThe firm may earn positive accounting profits, but will face economic losses The law of diminishing returns in a manufacturing plant of a fixed capacity implies that, eventually, employing one: A. More worker will increase the average amount of output per worker B. More worker will decrease the average amount of output per worker C. Less worker will decrease the average amount of output per worker D. Less worker will not affect the average amount of output per worker - answerMore worker will decrease the average amount of output per worker When a bakery manager reports that at her bakery, productivity of her 15 workers last month was 1,800 loaves per worker, she is referring to the: A. Total product of labor B. Average product of labor C.