1.Consider the production function Q = 2L +4K, where L is labor and K is capital.This production function exhibits?

a). No returns to scale

b). Constant returns to scale

c). Increasing returns to scale

d). Decreasing returns to scale

2.If economic profit is negative, it must bethat

a). opportunity cost is negative

b). accounting profit is negative

c). opportunity cost is greater than accounting profit

d). opportunity cost is positive

3.What best describes the situation where a firm has negative profit but it should operate in the short run?

a). The profit loss from operating is larger in magnitude than the total fixed costs

b). The profit loss from operating is smallerinmagnitude than the total fixed costs

c). The profit loss from operating is larger inmagnitude than the total variable costs

d). The profit loss from operating is smaller inmagnitude than the total variablecosts