Costs and Revenue

Fixed costs for a firm are costs which do not change directly with output.

True

False

What is the formula for calculating profit?

Marginal cost is calculated by dividing the total cost by the total output.

True

False

Marginal cost is the cost of producing one additional unit of output.

True

False

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Fixed costs are costs which do not change directly with .

What are fixed costs for a firm?

What is the short run in economics?

A period of time across which capital input is variable.
A period of time across which all factors of production can be varied.
A period of time across which labor input is fixed.
A period of time across which at least one of a firm's factors of production is fixed.

Fill in the missing word

The marginal cost is calculated by the change in total cost divided by the change in .

Fill in the missing word

In the long run, all factors of production are .

In the short run, at least one of a firm's factors of production is fixed.

True

False

Average revenue is equal to price.

True

False

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Average revenue is essentially the same thing as .

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In the short run, at least one of the firm's factors of production is .

Which factor of production is usually most variable in the short run?

What does the short run refer to in economics?

A period of time where all factors of production can be varied.
A period of time across which at least one of a firm's factors of production is fixed.
A period of time where a firm's revenue is fixed.
A period of time where a firm's profit is calculated.

How is the marginal cost calculated?

The marginal cost is calculated by the change in the total cost divided by the change in output.
The marginal cost is calculated by the total cost minus the total output.
The marginal cost is calculated by the change in the total cost multiplied by the change in output.
The marginal cost is calculated by the total cost divided by the total output.

How is the average revenue calculated in business?

The average revenue is calculated by multiplying the selling price by the quantity of output.
The average revenue is calculated by adding the total cost to the total revenue.
The average revenue is calculated by dividing the total revenue by the quantity of output.
The average revenue is calculated by subtracting the total cost from the total revenue.

What is the formula for calculating the total cost for a business?

How is the marginal cost calculated in a business?

The marginal cost is calculated by the change in the total cost divided by the change in output.
The marginal cost is calculated by the total cost minus the total output.
The marginal cost is calculated by the change in the total cost multiplied by the change in output.
The marginal cost is calculated by the total cost divided by the total output.

If a company has fixed costs of $50,000, variable costs of $30,000, and produces 2000 units, how would you calculate the average total cost per unit?

Divide the fixed costs by the number of units produced.
Subtract the variable costs from the fixed costs, then divide by the number of units produced.
Add the fixed and variable costs, then divide by the number of units produced, then add the fixed costs again.
Add the fixed and variable costs to get the total cost, then divide the total cost by the number of units produced.

What can a firm vary in the long run to expand its production?