All the decisions make for a firm have one overriding objective, which is to _________________.

maximize the quantity that it sells
maximize its total revenue
maximize its market share
make maximum attainable profit

Average product is the output produced per unit of ____________ , and marginal product is the output that a one-unit increase in ___________ can produce.

variable input; the fixed input
fixed input; all inputs
all inputs; all inputs
variable input; the variable input

The law of diminishing marginal returns says that as the firm uses more of ____________ , with a given quantity of ________, _______ product eventually decreases.

a variable input; fixed inputs; average
a fixed input; variable inputs; marginal
all inputs; capital; average
a variable input; fixed inputs; marginal

As more and more of the ___________ input is used, the total product curve increases quickly at first because _________product increases and then more slowly because _________.

variable; average; average product reaches a maximum
fixed; average; average product decreases
fixed; marginal; marginal product reaches a maximum
variable; marginal; marginal product diminishes

Which of the following statements is not true?

Total cost minus total fixed cost equals total variable cost.
As output increases, total cost and total variable cost increase together.
Total fixed cost plus total variable cost equals total cost.
As output increases, total cost and total fixed cost increase together.

Marginal cost is the increase in total__________ that results from a one-unit increase in ____________.

variable cost; the variable input
fixed cost; the fixed input
fixed cost; output
cost; output

Which of the following statements is true?

Average fixed cost equals total fixed cost per unit of fixed input.
Average variable cost equals total variable cost per unit of variable input.
Average total cost equals average fixed cost minus average variable cost.
Average fixed cost equals total fixed cost per unit of output.

Which of the following statements is not true?

In the long run, all costs are variable costs.
In the long run, the quantities of all inputs can be varied.
The firm's long run cost is the cost when it uses the economically efficient quantity of inputs.
In the long run, the average cost curve is downward sloping.

In the long run, the average cost curve ________________________________.

is made up of the lowest parts of the short-run average total cost curves
lies below the short-run average total cost curves
is the same as the short-run average total cost curves
is horizontal

With given input prices, constant returns to scale are present when the percentage increase in output _____________________________.

is zero
is positive
equals the percentage increase in all inputs
equals the percentage increase in all fixed inputs

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