The total revenue of a business is:

quantity of units sold multiplied by the sellingprice.

Which of the following is the best definition of economies of scale?

Costs per unit fall as the firm expands.

Which of the following is a reason for managers knowing the costs of the business?

It will help them fix the price of the product(s).

The best definition of the contribution made by a product is:

the difference between price and variable cost

The best definition of variable costs is:

They vary with the number of units produced.

studbud

Chapter 18: Costs & Revenues

11 termsStudBud Administration7,617 plays

Imported from external platform

Flashcards11 cardsFPractice quizPHost liveL

Questions 11

Answers

1
The total revenue of a business is:
quantity of units produced times unit production cost
the same as profit
equal to total costs
quantity of units sold multiplied by the sellingprice.
2
Which of the following is the best definition of economies of scale?
Fixed costs fall as output increases.
Costs fall as output increases.
Average costs rise as the firm expands.
Costs per unit fall as the firm expands.
3
A product sells for $14. Variable costs are $6.Fixed costs are $120,000. Break-even output is:
120,000 units
we cannot tell from the information given.
15,000 units
40,000 units
4
‘A detailed financial plan for the future’ is a definition of which of the following terms?
estimate of production costs.
scatter diagram
a budget
sales revenue forecast
5
The best definition of fixed costs are those that do not vary with:
time
output
number of workers.
seasons
6
Which one of the following costs is most likely to be variable for a fast food restaurant?
the machinery used to cook the food
the cost of the food supplies
the rent of the restaurant
the salary of the manager
7
The break-even level of output is that number of units where:
profit is at its highest level
total costs equal revenue
variable costs equal fixed costs.
variable costs equal revenue
8
If variable costs are $6 per unit,then total variable costs of producing 7,000 units will be:
$7,000
$21,000
$2,100
$70,000
9
Which of the following is a reason for managers knowing the costs of the business?
The information would have to be published to shareholders.
It will help them fix the price of the product(s).
They will be able to increase output.
Costs will tell the managers what the firm's profits are.
10
The best definition of the contribution made by a product is:
the difference between price and fixed cost.
the revenue gained from selling each item
the profit made on each item sold
the difference between price and variable cost
11
The best definition of variable costs is:
They vary with the prices charged by suppliers.
They vary over time.
They vary with the number of units produced.
They vary with tax rates set by government.

Chapter 18: Costs & Revenues Flashcards | StudBud