Scribd
Upload
62 views1 page

Economics Assignment Production and Cost

The document is an economics assignment covering topics related to production and costs, including: 1) Defining marginal product of input and distinguishing entrepreneurial income from other factor incomes. 2) Explaining whether average product can be zero or negative and what a point of inflection on the total product curve indicates. 3) Giving examples of implicit costs and why the gap between average total cost and average variable cost curves decreases with increasing output. 4) Defining normal profit and identifying true and false statements about total, average, and marginal product. 5) Describing the three phases of short-run production function and why it does not make economic sense to produce in phase I.

Uploaded by

Gurteg Singh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
62 views1 page

Economics Assignment Production and Cost

The document is an economics assignment covering topics related to production and costs, including: 1) Defining marginal product of input and distinguishing entrepreneurial income from other factor incomes. 2) Explaining whether average product can be zero or negative and what a point of inflection on the total product curve indicates. 3) Giving examples of implicit costs and why the gap between average total cost and average variable cost curves decreases with increasing output. 4) Defining normal profit and identifying true and false statements about total, average, and marginal product. 5) Describing the three phases of short-run production function and why it does not make economic sense to produce in phase I.

Uploaded by

Gurteg Singh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 1

ECONOMICS ASSIGNMENT

PRODUCTION AND COST


1. What is marginal product of input?
2. How income of producer (entrepreneur) is different from the incomes of other factors of
production.
3. Can average product be zero or negative? Why?
4. What does point of inflexion on Total Product curve indicate?
5. What is implicit cost? Give two examples.
6. Why does the gap between ATC and AVC curves decrease with increase in the level of output?
7. Define normal profit?
8. Giving reasons state whether following statements are true or false.
(a) TP increases only when AP increases.
(b) If MP falls, AP must also fall.
(c) If MP rises, AP must also rise.
(d) When there are diminishing returns to a factor, TP always decreases.
9. What are the three phases of short run production function? Why does it not make any
economic sense to produce in phase I?
10. Why MP curve intersects AP curve at its maximum point?
11. Do ATC and AVC curve intersect each other? Give reason.
12. Explain the relation between TC and MC?
13. Explain the behaviour of TC curve as output increases.
14. Complete the table:
UNITS AVC TC MC
1 ___________ 60 20
2 18 ___________ __________
3 ___________ ___________ 18
4 20 120 __________
5 22 ___________ __________

15. Complete the table:
UNITS AFC MC TC
1 ___________ ____________ ____________
2 ___________ 10 82
3 20 8 _____________
4 ___________ ____________ 99
5 12 10 ____________

16. Identify the times phases of the Law of Variable Proportion from the following schedule. Give
reasons for your answer.
UNITS OF VARIABLE INPUT TOTAL PRODUCT
1 50
2 55
3 50
4 45
5 36
6 26

You might also like