In the long run, a firm has
A) no factors of production that are fixed.
B) no factors of production that are variable.
C) no factors of production that are either fixed or variable.
D) fixed factors of production but no variable resources.

3 )Pizza Hut

Labor (workers) Total product(pizzas produced per hour)
0 0
1 5
2 9
3 12
4 14
5 15

Using the data in the above table, what is the marginal product of the second worker?
A) 4.5 pizzas per hour
B) 4 pizzas per hour
C) 5 pizzas per hour
D) The marginal product is undefined.

4 )Any method of producing a good or service is ________. It ________ the maximum profit that a firm can make.
A) an information constraint; always increases
B) a technology; decreases
C) a technology; limits
D) an information constraint; limits

5) Emma owns a firm that produces umbrellas. Currently, Emma produces 2,500 umbrellas a day. Emma cannot produce more umbrellas in a day unless she purchases another machine or else hires more workers. Emma is ________ efficient.
A) cost
B) technologically
C) economically
D) capital and labor

6) When a firm links its employees' compensation to the performance of the firm, the firm is using
A) an incentive system.
B) a command system.
C) a cooperative system.
D) an agency system.

7) Bill is working as the only employee at a local store. The relation between Bill and the owner of the store is such that Bill is ________ and the owner is ________ .
A) the agent; the principal
B) both principal and agent; neither a principal nor an agent
C) neither a principal nor an agent; both principal and agent
D) the principal; the agent

8) Which of the following is true regarding perfect competition?
I. The firms are price takers.
II. Marginal revenue equals the price of the product.
III. Established firms have no advantage over new firms.
A) I and II
B) II and III
C) I, II and III
D) I only

9) A perfectly competitive firm is producing the profit-maximizing amount of output when it is producing where its ________ curve intersects its ________ curve.
A) MC; MR
B) MC; AVC
C) MC; ATC
D) MC; TR

10) In the above figure, by increasing its output from Q1 to Q2, the firm
A) reduces its marginal revenue.
B) increases its marginal revenue.
C) decreases its profit.
D) increases its profit.

Question

In the long run, a firm has
A) no factors of production that are fixed.
B) no factors of production that are variable.
C) no factors of production that are either fixed or variable.
D) fixed factors of production but no variable resources.

3 )Pizza Hut

Labor (workers)                 	Total product(pizzas produced per hour)
0	                                                               0
1	                                                               5
2	                                                               9
3	                                                              12 
4	                                                              14
5	                                                              15

Using the data in the above table, what is the marginal product of the second worker?
A) 4.5 pizzas per hour
B) 4 pizzas per hour
C) 5 pizzas per hour
D) The marginal product is undefined.

4 )Any method of producing a good or service is ________. It ________ the maximum profit that a firm can make.
A) an information constraint; always increases
B) a technology; decreases
C) a technology; limits
D) an information constraint; limits

5) Emma owns a firm that produces umbrellas. Currently, Emma produces 2,500 umbrellas a day. Emma cannot produce more umbrellas in a day unless she purchases another machine or else hires more workers. Emma is ________ efficient.
A) cost
B) technologically
C) economically
D) capital and labor

6) When a firm links its employees' compensation to the performance of the firm, the firm is using
A) an incentive system.
B) a command system.
C) a cooperative system.
D) an agency system.

7) Bill is working as the only employee at a local store. The relation between Bill and the owner of the store is such that Bill is ________ and the owner is ________ . 
A) the agent; the principal
B) both principal and agent; neither a principal nor an agent
C) neither a principal nor an agent; both principal and agent
D) the principal; the agent

8) Which of the following is true regarding perfect competition?
I.	The firms are price takers.
II.	Marginal revenue equals the price of the product.
III.	Established firms have no advantage over new firms.
A) I and II
B) II and III
C) I, II and III
D) I only

9) A perfectly competitive firm is producing the profit-maximizing amount of output when it is producing where its ________ curve intersects its ________ curve.
A) MC; MR
B) MC; AVC
C) MC; ATC
D) MC; TR

10) In the above figure, by increasing its output from Q1 to Q2, the firm
A) reduces its marginal revenue.
B) increases its marginal revenue.
C) decreases its profit.
D) increases its profit.