Answer to Question #181940 in Macroeconomics for James

Question

QUESTION 20

This helps producers understand how increasing or decreasing production affects profits.

1. Average cost.
2. Variable cost.
3. Fixed cost.
4. Total cost.
5. Marginal cost.

QUESTION 21

Because all costs are variable, the long run production function:

1. Shows the most efficient way of producing any level of output.
2. Only exists in fairytales.
3. Cannot help us in any way.
4. Represents costs as fixed.
5. All of the above.

QUESTION 22

The long run depends on the specifics of the firm in question:

1. But it can never be longer than one year.
2. But it must always be shorter than one year.
3. But it can never be longer than five years.
4. But it can never be shorter than five years.
5. It is not a precise period of time.

QUESTION 23

Physical capital and labor:

1. Cannot simultaneously exist.
2. Are mutually exclusive inputs.
3. Can only serve as complements to each other.
4. Can often serve as substitutes for each other.
5. Are better than bacon.

Answer 1

Question 20.

 

5. Marginal cost help the producer understand how increasing or decreasing production affects the profits.

 

Question 21

Because all costs are variable the long run production function represents cost as fixed.

 

Question 22

The long run depends on the specifics of the firm in question, it is not a precise period of time.

 

Question 2

Physical capital and labor can often serve as substitute for each other.