Unit 3 : Cost of Production Reading Quiz # 6 6 points 1.Refer to the handout. Heritage Crisp Donuts explicit costs are: A) $286,000. B) $150,000. C)$200,000.

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Unit 3 : Cost of Production Reading Quiz # 6 6 points 1.Refer to the handout. Heritage Crisp Donuts explicit costs are: A) $286,000. B) $150,000. C)$200,000. D)$156,000. D)$380, Refer to the handout. Heritage Crisp Donuts economic profit is: A) $150,000. B) $80,000. C) $230,000. D) $94,000. E) $380,000

3. Economic profits are calculated by subtracting: A) explicit costs from total revenue. B) implicit costs from total revenue. C) implicit costs from normal profits. D) explicit and implicit costs from total revenue. 4. Refer to diagram #2 data on your handout showing the number of workers and quantity of burgers produced in one hour. The marginal product of the sixth worker is: A) 180 units of output. B) 30 units of output. C) 15 units of output. D) negative. E) cannot be calculated

5. Marginal product: A)diminishes at all levels of production. B)may initially increase, then diminish, but never become negative. C)may initially increase, then diminish, and ultimately become negative. D) is always less than average product. 6. The law of diminishing returns indicates that: A) as additional units of a variable resource are added to a fixed resource, marginal product will decline beyond some point. B) because of economies and diseconomies of scale a competitive firm's long- run average total cost curve will be U-shaped. C) the additional demand for goods produced by purely competitive industries is down-sloping. D) beyond some point the additional utility derived from additional units of a product will yield the consumer smaller and smaller extra amounts of satisfaction.