A"Count" for This
Costly Business
Widgetopia
Potpourri
Take the Long Way Home
100
How do you calculate profit? (In general).
Total Revenue - Total Costs = Profit
100
What are the axes on the cost functions?
X axis is output (widgets) and Y axis is $ per unit cost.
100
What are the axes on the production function?
X-axis is inputs (workers) and y axis is output (widgets)
100
What economic production concept was displayed when Kaveh joined widget making?
N_______ R_______
100
ALL costs are _________ in the Long-Run.
Variable
200
What is an explicit cost? Give an example of one for a pizza firm.
An explicit cost requires an outlay of money. Examples include: lease, tomato sauce, wages. etc.
200
Define fixed and variable costs. Define in terms of output.
Fixed costs don't change with output; variable costs increase as you increase output.
200
When a new worker hired brings in less widgets than the last worker hired, economists refer to this as the law of:
D_________ __________ ____________
Diminishing Marginal Product
200
The full name of our textbook author
Paul Krugman
200
When Long-Run Costs are falling this is referred to as? (Give the Economic Term)
Economies of Scale (Increasing Returns to Scale)
300
In economics, if an entrepreneur gives up the salary they could have earned as a Stock Broker in order to start their business, this is referred to as an:
I_________ C________
Implicit Cost
300
What is the definition of Marginal Cost?
The change in total cost if you increase output by 1 unit.
300
What are the three ranges / areas in a production function?
increasing marginal product, decreasing marginal product, negative marginal product
300
The economist who developed the principle of comparative advantage.
David Ricardo
300
Define "Diseconomies of Scale"
When Long-Run Average Total Costs are Increasing; when the size of the business has grown so large that it becomes less efficient (from a cost perspective) to increase size.
400
Explain WHICH is greater and WHY: Accounting Profit or Economics Profit?
Accounting profit is greater because it does NOT deduct IMPLICIT costs, whereas economic profit does deduct implicit costs.
400
When will Beth's MC start to rise?
After hiring the 4th worker or after producing the 33rd unit.
400
Where should the marginal product typically cross average product?
At the high point of the average.
400
Who is the current Chairperson of the Federal Reserve?
Jerome Powell
400
At what output level does diseconomies set in? 
After 30 units.
500
Tom wants to start his own business. He must purchase a factory for $300,000. In order to finance this purchase he uses $100,000 from his savings (which earns 10% interest) and then he borrows the remaining $200,000 at a 12% interest rate over 2 years. What's the amount of his explicit costs in year 1? Implicit costs in year 1?
Explicit = $12,000 (1/2 of .12 interest of 200k)
Implicit = $10,000 (10% of 100k)
500
Explain where and why marginal cost crosses ATC.
MC crosses ATC at min. ATC due to the relationship between the marginal and the average. (I'll listen to and decide on explanation).
500
Explain why marginal cost and marginal product are mirror images.
When adding variable inputs adds more to total product then additional costs are fall; when adding variable inputs adds less to total product then additional costs are rising.
500
Who is the current Secretary of the Treasury?
Janet Yellen.
500
Explain the shape of the U-shaped LRATC. (Explain why it falls, flattens and then rises).
Falling LRATC from specialization/efficiency of plant, constant from maximizing plant efficiency, rising from duplication/bureaucracy, mismanagement, etc.