The Cost of Production
CHAPTER 22
The Costs of Production
Topic Question numbers
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1. Costs: explicit and implicit 1-9
2. Profits 10-23
3. Short run versus long run 24-31
4. Law of diminishing returns 32-55
5. Short-run costs 56-157
6. Long-run costs 158-193 Last Word 194-196 True-False 197-210
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Multiple Choice Questions
Costs: explicit and implicit
Type: D Topic: 1 E: 392 MI: 148 1. Economic cost can best be defined as: A) any contractual obligation that results in a flow of money expenditures from an enterprise to resource suppliers. B) any contractual obligation to labor or material suppliers. C) compensations that must be received by resource owners to insure their continued supply. D) all costs exclusive of payments to fixed factors of production.
Answer: C
Type: A Topic: 1 E: 393 MI: 149 2. Which of the following constitutes an implicit cost to the Johnston Manufacturing Company? A) payments of wages to its office workers B) rent paid for the use of equipment owned by the Schultz Machinery Company C) depreciation charges on company-owned equipment D) economic profits resulting from current production
Answer: C
Type: A Topic: 1 E: 393 MI: 149 3. Which of the following is most likely to be an implicit cost for Company X? A) depreciation charges on company-owned equipment B) rental payments on IBM equipment C) payments for raw materials purchased from Company Y D) transportation costs paid to a nearby trucking firm
Answer: A
Type: A Topic: 1 E: 393 MI: 149 4. Costs to an economist: A) consist only of explicit costs. C) never reflect monetary outlays. B) may or may not involve monetary outlays. D) always reflect
The Costs of Production
Topic Question numbers
___________________________________________________________________________________________________
1. Costs: explicit and implicit 1-9
2. Profits 10-23
3. Short run versus long run 24-31
4. Law of diminishing returns 32-55
5. Short-run costs 56-157
6. Long-run costs 158-193 Last Word 194-196 True-False 197-210
___________________________________________________________________________________________________
Multiple Choice Questions
Costs: explicit and implicit
Type: D Topic: 1 E: 392 MI: 148 1. Economic cost can best be defined as: A) any contractual obligation that results in a flow of money expenditures from an enterprise to resource suppliers. B) any contractual obligation to labor or material suppliers. C) compensations that must be received by resource owners to insure their continued supply. D) all costs exclusive of payments to fixed factors of production.
Answer: C
Type: A Topic: 1 E: 393 MI: 149 2. Which of the following constitutes an implicit cost to the Johnston Manufacturing Company? A) payments of wages to its office workers B) rent paid for the use of equipment owned by the Schultz Machinery Company C) depreciation charges on company-owned equipment D) economic profits resulting from current production
Answer: C
Type: A Topic: 1 E: 393 MI: 149 3. Which of the following is most likely to be an implicit cost for Company X? A) depreciation charges on company-owned equipment B) rental payments on IBM equipment C) payments for raw materials purchased from Company Y D) transportation costs paid to a nearby trucking firm
Answer: A
Type: A Topic: 1 E: 393 MI: 149 4. Costs to an economist: A) consist only of explicit costs. C) never reflect monetary outlays. B) may or may not involve monetary outlays. D) always reflect