Test Bank For Principles of Microeconomics 3e by OpenStax | All Chapters (Newest Edition) 2025

2024
The amount of money that a firm receives from the sale of its
B B B B B B B B B B B B




output is called - CORRECT ANSWER >>total revenue
n B B B B B n




Totalr evenueequals -CORRECT ANSWER>>totaloutput
B n B B n B B B




nmultiplied by price per unit of output
B B B B B B B




explicit costs - CORRECT ANSWER >>require an outlay of
B B B B n B n B n




money by the firm
B
n B B B




Which of the following is an implicit cost?
B B B B B B B




(i) the owner of a firm forgoing an opportunity to earn a large
B B B B B B B n Bd B B B




salary working for a Wall Street brokerage firm
n B B B B B B B B




(ii) interest paid on the firm's debt B B B B B




(iii) rent paid by the firm to lease office space
B B B B B B B B




a. (ii) and (iii) B B




b. (i) and (iii)B B




c. (i) only B




d. all of the above are correct - CORRECT ANSWER >>c. (i) only
B B B B B B B B B




John owns a shoe-shine business. His accountant most likely includes
B B B B B B B B B




which ofthe following costs on his financialstatements?
B B B B B B B B B




a. wages John could earn washing windows B n B n B n n B n B n




b. dividends John's money was earning in the stock market before B n Bd B n Bd n B n Bd B n dB n Bd




John sold his stock and bought a shoe-shine booth
n B B B B B B B B B




c. the cost of shoe polish B B B B




d. all of the above are correct -
B CORRECT ANSWER >>c. the
B B B B B B B n




cost of shoe polish
B
n B B B

,The amount of money that a wheat farmer could have earned if hehad
B Bd B B n B B B B B n Bd B B B




planted barley instead of wheat is -
n B CORRECT ANSWER B B B B B B B




>>an implicit cost B B




Economic profit is equal to B B B B




(i) total revenue - (explicit costs + implicit costs) B
n B
n n n B
n n n B B B B




(ii) total revenue - opportunity costs B B B B




(iii) accounting profit + implicit costs - CORRECT ANSWER >>(i) B B B n B B n B




and (ii)
B B




accounting profit is equal to B B B B




(i) total revenue - implicit costs B B B B




(ii) total revenue - opportunity costs B B B B




(iii) economic profit+implicitcosts- CORRECT ANSWER>>(iii) B B B B B B B n




n only B




Economicprofit-CORRECT ANSWER>>willneverexceed B B B B B B n




naccountingprofit
B B




Economists normally assume that the goal of a firm is to - B B B B B B B B B B B




C n n >>maximizeits profit
B B dB dB dB dB dB dB dB dB dB
n n n n n n n B B




a production function is a relationship between - CORRECT
B n B n B n B n B n B n B n B n d




ANSWER >>inputs and quantity of output
B B B B B B




the marginal product of labor is equal to the - CORRECT ANSWER
B B B B B B B B B B B




>>increaseinoutputobtained from a one unitincreasein labor B B B B B B B B B




one would expect to observe diminishing marginal product ofl abor
B n B n dB n B n B n B n B n dB n B n




when - CORRECT ANSWER>>crowdedofficespace reduces the
B B B B B B B B n




nproductivity of new workers
B B B B

,Which of these assumption is often realistic for s firm in the shortrun?
B B
n B
n B
n B
n B
n B
n B
n B
n B
n B
n B
n B
n




a. the firm can vary both the size of its factory and the number of
B B
n B B B
n B B B
n B B B B n B




nworkers it employs
B B B




b. the firm can vary the size of its factory, but not the number of
B B B B B B B B B B B B n B n




nworkers it employs
B B B




c. the firm can vary the number of workers it employs, but not the
n B B
n B
n B
n B
n B
n B
n B
n B B
n B
n B
n




size of its factory
n B B B B




d. the firm can vary neither the size of its factory not the numberof
B
n B
n B
n n B n B
n B
n B
n B
n B
n n B n n B B
n




workers it employs - CORRECT ANSWER >>c. the firm can vary
n B B
n B
n B
n B B dB
n B
n B
n B
n B
n




the number of workers it employs, but not the size of its factory
n B B B B B B B B B B B B B




For a certain firm, the number of workers hired is the only variable input.
B B B B B B B B B B B B B




When this firm's production function is illustrated on a graph?
B n B n Bd n Bd B n Bd Bd Bd
n B n Bd




- CORRECT ANSWER >>the number of workers is measured on B B n B Bd B n Bd Bd




the horizontal axis and the quantity of output is measured on the
n B n B n B n B n B n B Bd Bd Bd n B B n




vertical axis
n B B




When a firm's only variable input is labor, then the slope of the
B B B B B B B B B B B B




productionfunctionmeasures the -CORRECT ANSWER
B
n B B B B B




>>marginal product of labor B B B




Let L represent the number of workers hired by a firm, and let Q
B B B B B B B B B B B B B




represent that firm's quantity of output. Assume two points on the
n B B Bd Bd B n B Bd B n B Bd B




firm's production function are (L = 12, Q = 122) and (L = 13, Q =
n B B B B B B B B B B B B B B B B




132). Then the marginal product of the 13th worker is
B
n B B B B B B B B B




a. 8 units of output. B n B B




b. 10 units of output. B n B n B n




c. 122 units of output. B n B n n B




d. 132 units of output. - B B B B CORRECT ANSWER >>a. 8 units of B B B B




output
B
n

, Fixed costs can be defined as costs that - CORRECT ANSWER
B B B B B B B B B




>>areincurred evenifnothing is produced
B B B B B B




average total costi s equal to -CORRECT ANSWER>>total
B B B n B B B B B




ncost/output
B




marginal cost equals B B




(i) change in total cost divided by change in quantity produced B B B B B B B B B




(ii) change in variable cost divided by change in quantity produced B B B B B B B B B




(iii) the average fixed costofthecurrent unit - CORRECT
B B B B B B B B d n n




ANSWER >>(i) an (ii)
BB B B B




Marginal costt ells us the -CORRECT ANSWER>> amountby B B n n B B B n n B B




which total cost rises when output is increased by one unit
B B B B B B B B B B B




Marginalc ostisequal to averaged total costwhen - CORRECT
B B B B B B B B B d




ANSWER >>average total costis at its minimum
BB B B B B B B B




Refer to Table 13-1. The average fixed cost of producing five
B B n B B B B n B B B B




widgets is -CORRECT ANSWER>>$2.00
B
n B B B B




Refer to Table 13-1. the average variable cost of producing four
B B n B Bd B B n B n B B B n




widgets is -CORRECT ANSWER >>$2.50
B
n B B B B




Refer to Table 13-1. The average total cost of producing one
B B B B B B n Bd B B B




widget is - CORRECT ANSWER >>$11.00
n B B B




Refer to Table 13-1. The marginal cost of producing the sixthwidgeti
B n B n n B n B n B n B n n B n B n B n B n B n n n s
-CORRECT ANSWER>>$6.00
B n B B




Refer to table 13-1. What is the variable cost of producing zero
B B B B B B B B B B B




widgets? - CORRECT ANSWER >>$0
n B B




Refer to Table 13-1. What is the marginal cost of producing thef
B B
n n B
n B B B B n B
n n B n B n B n B n n n n irst
widget? -CORRECT ANSWER>>$1.00
B B B B