Question

Question 1

Physical ________ and ________ can often substitute for each other.

Select the correct answer below:

capital, inventory

Inventory, output

capital, labor

output, labor

Question 2

Which of the following is the best description of what is shown by the long-run average cost (LRAC) curve?

Select the correct answer below:

the firm's average of total fixed and total variable costs at each level of output

the firm's total variable costs averaged for each level of input

the firm's total cost at each level of output

the firm's least expensive average total cost for any level of output

Question 3

If someone was to conduct a study in the field of microeconomics, which of the following questions might they attempt to answer?

Select the correct answer below:

What causes the economy to grow over the long term?

What determines the level of economic activity in a society?

What determines how many jobs are available in an economy?

When will a firm decide to expand, downsize, or close?

Answer 1

1.Physical capital and labor can be substituted for each other.They are both factors of production.

Answer-Capital,labor

2.The LRAC is U shaped and envelopes all short run average cost curves.The LRAC shows the least cost of production at every level of output.

Answer-The firm's least expensive average total cost for any level of output

3.Microeconomics is concerned with the behavior of a particular firm,consumer,producer.

Answer-When will a firm decide to expand, downsize, or close?