Producer Behaviour and Supply Test

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Producer Behaviour and Supply Test - 6

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Weekly Quiz Competition

Question 1
1 / -0

Money costs mean:

A
Money spent by the consumers

B
Money expenditure on output

C
Money expenditure of a producer in the production process

D
Money expenditure on purchase of goods from the factory

Solution

When production cost is expressed in terms of monetary units, it is called money cost. Money cost refers to the sum of monetary expenses incurred by the producer for producing a commodity. Real cost refers to the pains discomfort and disutility involved in supplying the factors of production by their owners.
Question 2
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What does average revenue measure?

A
Total revenue divided by quantity sold.

B
Price per unit multiplied by quantity sold.

C
Marginal revenue divided by quantity sold.

D
Change in total revenue when one more unit of output is sold.

Solution

Average revenue is calculated by dividing total revenue by the quantity sold. It represents the revenue earned per unit of output sold.
Question 3
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Which of the following conditions is necessary for producer's equilibrium?

A
Marginal revenue is greater than marginal cost.

B
Marginal revenue is less than marginal cost.

C
Marginal revenue equals marginal cost.

D
Marginal revenue is constant.

Solution

Producer's equilibrium occurs when marginal revenue equals marginal cost, ensuring profit maximization.

Marginal Revenue (MR): This represents the additional revenue earned by selling one more unit of a product. In other words, it's the change in total revenue resulting from selling one additional unit of output.

Marginal Cost (MC): This represents the additional cost incurred by producing one more unit of a product. It includes both variable and marginal costs of production.

When marginal revenue equals marginal cost (MR = MC), it implies that the revenue gained from producing and selling one more unit of the product is exactly equal to the cost incurred in producing that additional unit.
Question 4
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Implicit costs are:

A
Opportunity costs

B
Total cost

C
Impute

D
Same as explicit costs

Solution

Implicit costs are impute. An implicit cost isany cost that has already occurred but not necessarily shown or reported as aseparate expense. It represents an opportunity cost that arises when a companyuses internal resources toward a project without any explicit compensation forthe utilization of resources.
Question 5
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The term 'Cobb:- Douglas production function' is related to which field?

A
Economics

B
Chemistry

C
Mathematic

D
Physics

Solution

It is a mathematical model that describes the relationship between the output of a production process and the inputs of labor and capital. It is named after Charles Cobb and Paul Douglas, who developed it in the 1920s. The Cobb-Douglas production function is often used in economics to model the growth of an economy.
Question 6
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Total revenue is calculated by:

A
Multiplying average revenue by quantity sold.

B
Subtracting total variable cost from total cost.

C
Multiplying price per unit by quantity sold.

D
Adding average cost to marginal cost.

Solution

Total revenue is calculated by multiplying the price per unit by the quantity sold. It represents the total income earned by the firm from selling its output.
Question 7
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What does "Producer's Equilibrium" refer to?

A
The point where a producer maximizes profit.

B
The point where a producer minimizes cost.

C
The point where marginal revenue equals marginal cost.

D
The point where average revenue equals average cost.

Solution

Producer's equilibrium is achieved when a producer maximizes profit by producing the quantity at which marginal revenue equals marginal cost.
Question 8
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Market supply is best defined as:

A
Horizontal summation of all individual quantitysupplied at various prices

B
Vertical summation of all individual quantitysupplied at various prices

C
Vertical summation of all individual quantitysupplied at a given price

D
Horizontal summation of all individual quantitysupplied at a given price

Solution

A horizontal summation of individual supply curves is a market supply curve. It depicts various amounts of a commodity that all market participants are willing to sell at various conceivable prices.
Question 9
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What is the significance of marginal product?

A
It measures the change in total product resulting from a one-unit change in the variable input.

B
It calculates the average product divided by the number of units of input.

C
It computes the total product divided by the number of units of input.

D
It determines the change in total cost resulting from a one-unit change in the level of production.

Solution

The marginal product represents the additional output produced when one more unit of a variable input, such as labor or raw material, is added while keeping other inputs constant. It helps in determining the most efficient level of input usage.
Question 10
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Revenue for a firm is:

A
Money receipts from the sale of output

B
Average price of a product sold

C
Addition to Total revenue after a good is sold

D

Money spent on producing output

Solution

Total revenue refers to money receipts of a firmfrom the sale of its total output. It is estimated as the multiple of price andquantity of output.

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Re-Attempt Weekly Quiz Competition

Producer Behaviour and Supply Test - 6

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Producer Behaviour and Supply Test - 6

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SHARING IS CARING

Question 1

Money spent by the consumers

Money expenditure on output

Money expenditure of a producer in the production process

Money expenditure on purchase of goods from the factory

Solution

Question 2

Total revenue divided by quantity sold.

Price per unit multiplied by quantity sold.

Marginal revenue divided by quantity sold.

Change in total revenue when one more unit of output is sold.

Solution

Question 3

Marginal revenue is greater than marginal cost.

Marginal revenue is less than marginal cost.

Marginal revenue equals marginal cost.

Marginal revenue is constant.

Solution

Question 4

Opportunity costs

Total cost

Impute

Same as explicit costs

Solution

Question 5

Economics

Chemistry

Mathematic

Physics

Solution

Question 6

Multiplying average revenue by quantity sold.

Subtracting total variable cost from total cost.

Multiplying price per unit by quantity sold.

Adding average cost to marginal cost.

Solution

Question 7

The point where a producer maximizes profit.

The point where a producer minimizes cost.

The point where marginal revenue equals marginal cost.

The point where average revenue equals average cost.

Solution

Question 8

Horizontal summation of all individual quantitysupplied at various prices

Vertical summation of all individual quantitysupplied at various prices

Vertical summation of all individual quantitysupplied at a given price

Horizontal summation of all individual quantitysupplied at a given price

Solution

Question 9

It measures the change in total product resulting from a one-unit change in the variable input.

It calculates the average product divided by the number of units of input.

It computes the total product divided by the number of units of input.

It determines the change in total cost resulting from a one-unit change in the level of production.

Solution

Question 10

Money receipts from the sale of output

Average price of a product sold

Addition to Total revenue after a good is sold

Money spent on producing output

Solution

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