Take this Quiz: A-Level Economics: Costs, Revenue and Profit | Zestly

Question 1

In the short run, a firm's total cost function is $TC = 100 + 5Q + 0.5Q^2$. Using the marginal cost function derived from this total cost function, what is the marginal cost when output is Q = 10?

Accepted Answer

£15

Question 2

Which of the following are examples of internal economies of scale?

Accepted Answer

Purchasing economies from bulk buying

Question 3

A firm produces 100 units at a total cost of $500 and 101 units at a total cost of $506. What is the marginal cost of the 101st unit?

Accepted Answer

$6$

Question 4

Which factors contribute to the law of diminishing marginal returns in the short run?

Answer

All factors of production are variable

Answer

At least one factor of production is fixed

Answer

The addition of variable factors leads to smaller increases in output

Answer

The firm experiences constant returns to scale

Question 5

If a firm is operating where $MR = MC$ and $AR > AC$, what is the firm's profit status?

Answer

Normal profit

Answer

Loss-making

Answer

Supernormal profit

Answer

Break-even