Hypothetical Firm and Production Function Quiz
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Questions and Answers

At what point does the law of variable proportion begin to operate?

  • When the average product curve is at its peak
  • When the marginal product curve reaches its minimum point
  • When the marginal cost curve reaches its maximum point (correct)
  • When the total cost function intersects the average variable cost function

    • According to the provided information, what is the total loss incurred by the hypothetical firm?

  • Birr 1000
  • Birr 1500
  • Birr 500
  • Birr 2000 (correct)

    • What is the total product achieved by employing one unit of labor for the hypothetical firm?

  • 0 units
  • -1 units
  • -15 units (correct)
  • 16 units

    • What is the average product obtained by employing 2 units of labor?

    <p>-6 units</p> Signup and view all the answers

    What is the marginal product obtained from the third unit of labor for the hypothetical firm?

    <p>1 unit</p> Signup and view all the answers

    In the short run, what happens to total product, average product, and marginal product at the first unit of a variable input?

    <p>They are all equal</p> Signup and view all the answers

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