Questions from Managerial Economics


Q: Food Fanatics caters meals where its costs of producing an extra meal

Food Fanatics caters meals where its costs of producing an extra meal is $25. Each of its meals sells for $20. At this rate, what should the company do? a. Produce more meals and increase its profit...

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Q: A business owner makes 1000 items a day. Each day she

A business owner makes 1000 items a day. Each day she contributes eight hours to produce those items. If hired elsewhere, she could have earned $250 an hour. The item sells for $15 each. Production do...

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Q: If a firm is earning negative economic profits, it implies

If a firm is earning negative economic profits, it implies a. That the firm’s accounting profits are zero. b. That the firm’s accounting profits are positive. c. That the firm’s accounting profits are...

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Q: Opportunity costs arise due to a. Resource scarcity b

Opportunity costs arise due to a. Resource scarcity b. Lack of alternatives c. Limited wants d. Abundance of resources

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Q: After graduating from college, Jim had three choices, listed in

After graduating from college, Jim had three choices, listed in order of preference: (1) Move to Florida from Philadelphia, (2) work in a car dealership in Philadelphia, or (3) play soccer for a minor...

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Q: Economic Value Added helps firms avoid the hidden-cost fallacy

Economic Value Added helps firms avoid the hidden-cost fallacy a. by ignoring the opportunity costs of using capital b. by differentiating between sunk and fixed costs c. by taking all capital costs...

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Q: The fixed-cost fallacy occurs when a. A firm

The fixed-cost fallacy occurs when a. A firm considers irrelevant costs b. A firm ignores relevant costs c. A firm considers overhead or depreciation costs to make short-run decisions d. Both a and...

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Q: Mr. D's Barbeque of Pickwick, TN, produces 10,

Mr. D's Barbeque of Pickwick, TN, produces 10,000 dry-rubbed rib slabs per year. Annually Mr. D's fixed costs are $50,000. The average variable cost per slab is a constant $2. The average total cost p...

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Q: Which of the following provides an example of divisions based on a

Which of the following provides an example of divisions based on a functional organizational structure? a. Americas, Africa, Asia, Europe b. Research and development, production, finance, marketing c....

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Q: All the following are examples of variable costs, except a

All the following are examples of variable costs, except a. Hourly labor costs b. Cost of raw materials c. Accounting fees d. Electricity cost

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