Economic profit is the difference between total revenue and
Average cost
Marginal cost
Economic cost
Total cost
In the short term a firm will produce provided the revenue
Covers fixed costs
Covers variable costs
Covers total costs
Covers sales
If marginal cost is positive and falling
Total cost is falling
Total cost is increasing at a falling rate
Total cost is falling at a falling rate
Total cost is increasing at an increasing rate
_______ increases and decreases with the volume of output .
Fixed cost
Variable cost
Money cost
If law of diminishing return is in operation average cost
Decreases
Increases
Remains constant
Decreases slowly
Which one of the following statement is true ?
If the marginal cost is greater than the average cost the average cost falls
If the marginal cost is greater than the average cost the average cost increases.
If the marginal cost is positive total costs are maximised.
If the marginal cost is negative total costs increase at a decreasing rate if output increases.
According to the law of diminishing returns
The marginal product eventually falls as more units of a variable factor are added to a fixed factor
Marginal utility falls as more units of a product are consumed
The total product falls as more units of a variable factor are added to a fixed factor
The marginal product eventually increases as more units of a variable factor are added to a fixed factor
The profit per sale is a measure of
Cash flow
Profitability
Feasibility
Liquidity
Average fixed cost
Never becomes zero
Curve never touches x axis
Curve never touches y axis
All the above
The average variable cost curve
Is derived from the average fixed costs
Converges with the average cost as output increases
Equals the total costs divided by the output
Equals revenue minus profits