1. Economists include _____ in calculating economic profit
2. Brittany is considering opening a clothing store. She is concerned because she spent $60,000 earning a degree in biology and will not be using it. The $60,000 is an example of a _____ cost.
3. Accountants include _____ in calculating accounting profit.
4. In determining a firm's costs, accountants include _____ costs, and economists include _____costs.
5. _____ costs are short-run costs that do not change with the quantity of output.
6. _____ is the positive difference between revenue and cost.
7. The _____ function indicates the amount of output that can be produced with various levels of inputs, given the current technology.
8. Total revenue minus total cost is?
9. A negative economic profit is referred to as _____ loss.
10. Because of diseconomies of scale, a firm may downsize in an effort to reduce _____ cost.
11. ________ is a cost that changes with the quantity produced by the firm and is incurred by the firm in the short run.
12. Suppose you know that at the current level of production average total cost equals marginal cost, then you know that it is also true that:

-> average total cost is minimized at the current level of output.

-> average fixed costs are increasing.

->average total cost will decrease if production is increased.

-> fixed costs are zero

1. When does a firm's average variable cost exceed the average total cost?
2. In the long run which one is true from the following:

a. some factors of production are variable, while at least one factor of production is fixed.

b. all factors of production are fixed.

c. None of the above are correct.

d. all factors of production are variable

1. Suppose your firm is operating in a perfectly competitive market, and that the minimum average variable cost of producing your good is $30. If the price of the good is $32, your firm should do which of the following?

a. supply the amount of the good where the marginal cost of production is equal to $32.

b. not produce anything since the price is above the minimum of average variable cost.

c. supply the amount of the good where the marginal cost of production is $30.

d. not consider price when determining the amount to sell.

1. If a firm in a perfectly competitive market is currently producing the output where price = marginal cost = average total cost, the firm is doing what from the following?

a. suffering an economic loss.

b. earning a zero economic profit.

c. earning a positive economic profit.

d. all of the above

1. _____ occurs when economic profit equals zero.
2. In deciding how much to produce, a firm looks to the _____ cost curve.
3. In a competitive market, a firm achieves _____ efficiency when it obtains output for the lowest possible cost.