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Economics and Managerial Decision-Making: A Comprehensive Quiz on Key Concepts

This quiz tests understanding of managerial economics.

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    Economics and Managerial Decision - Making: A Comprehensive Quiz on Key Concepts 1 Other things held constant, consumer surplus increases as: The price of a good decreases . The price of a good increases. The supply curve shifts to the left. None of the above. 2. When there are diseconomies of scope between two products that are separately produced by two firms, merging into a single firm can: accomplish an increase in sales. accomplish a reduction in costs. lead to an increase in cost. lead to a reduction in sales. 3. For a cost function C = 100 + 5Q + 2Q 2 , the average variable cost of producing 10 units of output is: 10. 25. 35. None of the answers are correct. 4. Other things held constant, producer surplus decreases as: The price of a good decreases. The price of a good increases. The demand curve shifts upward. None of the above. 5. Managerial economics: helps managers with day - to - day decisions. helps managers with long - term decisions. is valuable to the manager of a not - for - profit organization. All of the above statements are correct. 6. The change in benefits that arises from a one - unit change in quantity is

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    the: marginal net benefits. marginal benefits. total net benefits. variable benefits. 7. Economic profits are: the same as accounting profits. accounting profits minus implicit costs . the same as total revenue. total profits of the economy as a whole. 8. A curve that defines the minimum average cost of producing different levels of output (allowing for optimal selection of all variables of production) is: long - run average cost curve . long - run variable cost curve. short - run average variable cost curve. short - run variable cost curve. 9. Other things held constant, consumer surplus decreases as: The price of a good decreases. The price of a good increases . The supply curve shifts to the right. None of the above. 10 Suppose the cost function is C(Q) = 100 + Q − 2Q 2 + 2Q 3 . What are the fixed costs? $4 $2 $100 1 – 4Q + 6Q 2 11. Given the linear production function Q = 2K + 10L, if Q = 2,000 and L = 100, how much capital is utilized? 500 units 800 units 600 units 1,000 units 12. Graphically, an increase in advertising will cause the demand curve to:

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