1) A production function establishes the relationship between:
A) the market price of a good and the sales revenue generated.
B) the quantity of output produced and the firm's profit.
C) the quantity of inputs used and the quantity of output produced.
D) the market price of a good and the quantity of output supplied.
2) Which of the following statements is true of the short run?
A) Only some of a firm's input can be varied in the short run.
B) All firms earn zero economic profits in the short run.
C) All factors of production can be changed in the short run.
D) All the factors of production are fixed in the short run.
3) In the long run:
A) all factors of production are fixed.
B) only some inputs of a firm can be changed.
C) all firms earn positive economic profits.
D) all factors of production can be changed.
4) Which of the following inputs can be changed in the short run?
A) Machinery
B) Land owned
C) Office Space
D) Labor employed
5) Which of the following statements is true of the long run?
A) There are no fixed inputs in the long run.
B) Capital cannot be changed in the long run.
C) Labor cannot be changed in the long run.
D) A firm cannot alter its level of output in the long run.