Tackle the Test: Free-Response Questions

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  1. Question

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    Use the information in the table below to answer the following questions.

    Rubric for FRQ 1 (6 points)

    image

    1 point: FC = $40

    1 point: We can identify the fixed cost as $40 because when the firm is not producing, it still incurs a cost of $40. This could only be the result of a fixed cost because variable cost is zero when output is zero.

    1 point: Graph with correct labels (“Cost of unit” on vertical axis; “Quantity” on horizontal axis)

    1 point Upward-sloping MC curve plotted according to data, labeled “MC

    1 point: U-shaped ATC curve plotted according to the provided data, labeled “ATC

    1 point: MC curve crossing at minimum of ATC curve (Note: We have simplified this graph by drawing smooth lines between discrete points. If we had drawn the MC curve as a step function instead, the MC curve would have crossed the ATC curve exactly at its minimum point.)

  2. Question

    q9FUN83VDUoR7OJgRBsYE2q2UZLcdZJV85wjzR66Q3KhP5aq1qN8IbLNSd+0t+p1jJeJPdn/6R2+K/8lHFdrR/2sx9lTCsMMv1zAq6niBsTIPWuAvZooClX/qXj97ntl4U+OGnCpNiunqWTWpytcdeO92g/2epiDu+z/gRio8OBS01kk+MqCyMdqtPAloMIC7Yws6+Ay6XOJ8VGrrG0TnbC5qcnCmj+cHlYoA86jh10ukvcVCGw/gbMx6cqnt+NUL2JiuqP1/rI5wzZquQVZv79+jgkAd5hu2b6uayX5H/EUxwPkEmvsEm1xGsixLAPeKGvMyeu9zP9Ei7BTa259EexKjqkIYmWBg3lZtbrlAaBKmXUyqI2RZASixVK7FV6QIMLfBI0AJw2xnXCgW8PR7TuRnBItWr2m9Fwnqh97UKcwwrH3gkGwkWRuPtwQMSLm