Paper , Order, or Assignment Requirements

1. Firms may be able to produce more efficiently than households because:
2. firms can reduce transaction costs
3. team production may be more productive than individual production
4. Both of the above
5. Neither of the above

2. Transaction costs:
3. are the costs of bringing buyers and sellers together for exchanges
4. are always minimized when consumers purchase directly from producers
5. Both of the above
6. Neither of the above

3. In terms of sales, the most important type of business firm is the:
4. proprietorship
5. partnership
6. corporation
7. nonprofit firm

4. The chief goal of all business firms is assumed to be:
5. market share maximization
6. profit-maximization
7. sales maximization
8. maximum cost efficiency

5. In a competitive market, the goal of profit-maximization will compel a business firm to:
6. use its resources to produce in response to consumer demand
7. use its resources so as to ensure maximum job security for its employees
8. Both of the above
9. Neither of the above

6. The most common legal type of business firm is the:
7. corporation
8. partnership
9. proprietorship
10. nonprofit firm

7. A firm owned and operated by two or more co-owners is a:
8. corporation
9. partnership
10. proprietorship
11. nonprofit firm

8. A corporate share of stock:
9. is the same as a corporate bond
10. is an ownership interest in the corporation
11. Both of the above
12. Neither of the above

9. A corporate bond:
10. is an ownership interest in the corporation
11. is a debt obligation of the corporation
12. Both of the above
13. Neither of the above

10. According to Adam Smith, the greatest improvement in the productivity of labor is caused by:
11. public education
12. the division of labor
13. the internet
14. None of the above

11. A sunk cost:
12. is a past cost that cannot be changed by current decisions
13. should not influence current decisions
14. Both of the above
15. Neither of the above

12. A period in which at least one input is fixed is:
13. the short run
14. the long run
15. the planning run
16. the Pamplona run

13. The change in output with one additional unit of input is:
14. marginal revenue product
15. marginal cost
16. marginal physical product
17. marginal input output

14. The law of diminishing marginal returns:
15. applies eventually when larger amounts of a variable input are combined with fixed inputs
16. causes an increase in the marginal cost of production
17. Both of the above
18. Neither of the above

15. Fixed costs:
16. are costs that vary with output
17. are costs that do not vary with output
18. are the costs associated with the fixed inputs
19. Both b. and c. above

16. Concerning the cost curves:
17. the AFC curve always slopes downward
18. the AVC and ATC curves eventually slope upward due to the law of diminishing marginal returns
19. Both of the above
20. Neither of the above

17. If marginal cost is equal to ATC:
18. ATC must be decreasing
19. ATC must be increasing
20. ATC must be at its lowest point
21. All of the above are possible

18. If marginal cost is greater than ATC:
19. ATC must be decreasing
20. ATC must be increasing
21. ATC must be at its lowest point
22. All of the above are possible