Question

1- - As a firm expands by adding more of the variable input to fixed inputs, it experiences:

a) constant returns, diminishing returns, increasing returns

b) diminishing returns, constant returns, increasing returns

c) increasing returns, constant returns, diminishing returns

d) diminishing returns, increasing returns, constant returns

2- The Production Function is:

a) a curve concave to the origin

b) an upside down parabola

c) A straight line sloping upward

d) An "S" curve

3- The production function shows :

a) the relationship between total product, (output or quantity) and the variable input

b) the trade off between cranberries and blueberries

c) the quantity supplied at various prices

d) the quantity demanded at various prices

4- At Cosi, 2 people make 10 salads in an hour and 3 people make 24 salads in an hour Marginal Product is(select all that apply)

a) greater than average product and therefore average product must be increasing

b) 8

c) 5

d) Best plotted above the Input of 2.5

5- At Cosi, 2 people make 10 salads in an hour and 3 people make 24 salads in an hour What is the average product of the 3 person team?

6- At Cosi, 2 people make 10 salads in an hour and 3 people make 24 salads in an hourWhat is the average product of the 2 person team?

7- At Cosi, 2 people make 10 salads in an hour and 3 people make 24 salads in an hour What is the marginal product of the 3rd person?

8- At Cosi, 3 people make 24 salads in an hour and 2 people make 10 salads in an hour If you were to tell the 3rd person to go home, how much production would

you lose?

9- At Cosi, 5 people make 50 salads in an hour and 6 people make 60 salads in an hour What is the average product of the 5 person team?

10-At Cosi, 5 people make 50 salads in an hour and 6 people make 60 salads in an hour What is the average product of the 6 person team?

11- At Cosi, 5 people make 50 salads in an hour and 6 people make 60 salads in an hour What is the marginal product of the 6th person?

At Cosi,

12- You would expect that in on hour, 7 people... select all that apply

		would start to run out of mixing bowls and get in each others way
		make more than 70 salads
		is the beginning of diminishing returns
		would make 69 salads or fewer

Answer 1

1) increasing return, constant return, diminishing returns.

2)an upside down parabola.

3)the relationship between total product, (output or quantity) and the variable input.

4)greater than average product and therefore average product must be increasing.

5) average product is 11.33 per person.

6) average product of 2person is 5 each.

7) marginal product of 3rd person is 14.

8) i will loose 14 units.

9) average product for 5 person team is 10.

10) average product of 6 person team is 10.

11) marginal product of the 6th person is 10.

12)