Pre-Test Chap 11w e18 - Pre-Test Chap 11w e18 1. An...

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Pre-Test Chap 11w e18 1. An exclusive right to sell any new and useful process, machine, or product for a fixed period of time is a: A. Patent B. Copyright C. Trade secret D. Trademark The next question(s) are based on the following table showing the expected rate of return, R&D spending, and interest-rate cost-of-funds for a hypothetical firm. 2. Refer to the above data. In a supply and demand graph, the interest-cost of funds curve would be a(n): A. Vertical line at 7 percent B. Horizontal line at 7 percent C. Upward sloping line over the 5 to 13 percent range D. Downward sloping line over the 13 to 5 percent range 3. The first discovery of a product or process through the use of imagination, ingenious thinking, and experimentation is: A. Process innovation B. Product innovation C. Invention D. Imitation 4. What is an example of a technological breakthrough that came out of a government or university laboratory? A. The Internet B. Aluminum cans C. Scientific calculators D. Disposable contact lenses Assume a firm faces these costs: total cost of capital = $4,000; price paid for labor = $20 per labor unit; and price paid for raw materials = $8 per raw-material unit.
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5. Refer to the above information. Originally the firm produced 2,000 units of output by combining its fixed capital with 200 units of labor and 500 units of raw materials. Now the firm changes its production process so that it can produce 3,000 units of output by combining its fixed capital with 100 units of labor and 500 units of raw materials. What happened to average total cost? A. ATC decreased by $2.67 B. ATC increased by $2.67 C. ATC increased by $3.33 D. ATC decreased by $3.33 6. Refer to the above information. A firm improves its production process so that it can produce 3,000 units of output by combining its fixed capital with 100 units of labor and 500 units of raw materials. What are the total cost and average cost of producing the 3,000 units of output? A. TC = $4,000; ATC = $2.00 B. TC = $8,000; ATC = $3.00 C. TC = $10,000; ATC = $3.33 D. TC = $15,000; ATC = $6.00 7. Consumer acceptance of a new product depends on: A. Price alone B. Marginal utility alone C. Price and marginal utility D. Total utility divided by marginal utility 8. Which would be an example of innovation within existing business firms?
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This note was uploaded on 05/23/2010 for the course ECON 101 taught by Professor Keep during the Spring '10 term at Glendale Community College.

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Pre-Test Chap 11w e18 - Pre-Test Chap 11w e18 1. An...

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