KEY952F - BUSINESS 702 MANAGERIAL ECONOMICS SECOND EXAM KEY...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
BUSINESS 702 SECOND EXAM KEY FALL 1995 MANAGERIAL ECONOMICS MULTIPLE CHOICE QUESTIONS (50 pts, 2pt each) 1. A new production function results following: A. a new wage agreement following collective bargaining. B. a surge in product demand. C. a decrease in the availability of needed inputs. > D. the successful completion of a training program that enhances worker productivity. 2. The relation between output and the variation in all inputs taken together is the: A. factor productivity of a production system. B. law of diminishing returns. > C. returns to scale characteristic of a production system. D. returns to factor characteristic of a production system. 3. An irrational employment policy is indicated when the marginal product of X is: > A. negative. B. positive. C. decreasing. D. increasing. 4. When P X = $60, MP X = 5 and MP Y = 2, relative employment levels are optimal provided: A. P Y = 16.7¢. > B. P Y = $24. C. P Y = $60. D. P Y = $150. 5. When P X = $100, MP X = 10 and MR Q = $5, the marginal revenue product of X equals: A. $100. > B. $50. C. $10. D. $5. 6. The foregone value associated with the current rather than next-best use of a given asset is called: A. current cost. B. replacement cost. C. historical cost. > D. opportunity cost. 7. Unlike the marginal cost concept, the incremental cost concept: A. does not focus on individual managerial decisions. B. is not relevant for optimal output determination. C. embodies sunk costs. > D. can involve multiple units of output. 8. In the long run, the: A. availability of at least one input is fixed. B. firm's operating decisions are typically constrained by prior capital expenditures. C. availability of all but one input is fixed. > D. firm has complete flexibility with respect to input use. 9. When e C < 1: A. decreasing returns to all factors are implied. > B. increasing returns to scale are implied. C. decreasing returns to scale are implied. D. constant returns to scale are implied. 10. Learning involves: A. movements along a single LRAC curve.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 B. movements along a single SRAC curve. C. shifts in SRAC curves over time. > D. shifts in LRAC curves over time. 11. When an LP objective function is to maximize profits: > A. resource constraints must be of the # variety. B. resource constraints must be of the $ variety. C. all input costs must be variable. D. the total revenue function must not be linear. 12. If X > 0 in the primal solution: > A. the marginal value of inputs just equals the marginal value of output in X production. B. the marginal value of inputs exceeds the marginal value of output in X production. C. L X > 0 in the dual solution. D. L X < 0 in the dual solution. 13. When the primal LP problem is to maximize revenue subject to various input constraints, the shadow prices of inputs in the dual constraints: > A. equal the marginal revenue product of each input.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 8

KEY952F - BUSINESS 702 MANAGERIAL ECONOMICS SECOND EXAM KEY...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online