Ch06 - CHAPTER 6 Production MULTIPLE CHOICE SECTION 6.1...

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CHAPTER 6 Production MULTIPLE CHOICE SECTION 6.1 moderate 1. A production function defines the output that can be produced a. at the lowest cost, given the inputs available. b. with the fewest amount of inputs. c. if the firm is technically efficient. d. in a given time period if no additional inputs are hired. e. as technology changes over time. easy 2. A production function assumes a given a. technology. b. set of input prices. c. ratio of input prices. d. amount of capital and labor. e. amount of output. easy 3. A function that indicates the maximum output per unit of time that a firm can produce, for every combination of inputs with a given technology, is called a. an isoquant. b. a production possibility curve. c. a production function. d. an isocost function. easy 4. Use the following two statements to answer this question: I. Production functions describe what is technically feasible when the firm operates efficiently. II. The production function shows the least cost method of producing a given level of output. a. Both I and II are true. b. I is true, and II is false. c. I is false, and II is true. d. Both I and II are false. moderate 5. A farmer uses L units of labor and K units of capital to produce Q units of corn using a production function F(K,L). A production plan that uses K’=L’=10 to produce Q’ units of corn where Q’ < F(10, 10) is said to be a. technically feasible and efficient b. technically unfeasible and efficient c. technically feasible and inefficient d. technically unfeasible and inefficient e. none of the above 194
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TEST BANK PRODUCTION SIXTH EDITION easy 6. Which of the following inputs are variable in the long run? a. labor. b. capital and equipment. c. plant size. d. all of these. easy 7. The short run is a. less than a year. b. three years. c. however long it takes to produce the planned output. d. a time period in which at least one input is fixed. e. a time period in which at least one set of outputs has been decided upon. SECTION 6.2 easy 8. Writing total output as Q, change in output as Q, total labor employment as L, and change in labor employment as L, the marginal product of labor can be written algebraically as a. Q L. b. Q / L. c. L / Q. d. Q / L. easy 9. The slope of the total product curve is the a. average product. b. slope of a line from the origin to the point. c. marginal product. d. marginal rate of technical substitution. easy 10. The law of diminishing returns refers to diminishing a. total returns. b. marginal returns. c. average returns. d. all of these. easy 11. When labor usage is at 12 units, output is 36 units. From this we may infer that a. the marginal product of labor is 3. 195
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Ch06 - CHAPTER 6 Production MULTIPLE CHOICE SECTION 6.1...

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