Chapter 18: Costs & Revenues
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  • Question 1
    30 seconds
    Q. Which of the following is a reason for managers knowing the costs of the business?
    answer choices
    They will be able to increase output.
    It will help them fix the price of the product(s).
    The information would have to be published to shareholders.
    Costs will tell the managers what the firm's profits are.
  • Question 2
    30 seconds
    Q. Which one of the following costs is most likely to be variable for a fast food restaurant?
    answer choices
    the salary of the manager
    the rent of the restaurant
    the cost of the food supplies
    the machinery used to cook the food
  • Question 3
    30 seconds
    Q. The best definition of variable costs is:
    answer choices
    They vary with the number of units produced.
    They vary over time.
    They vary with the prices charged by suppliers.
    They vary with tax rates set by government.
  • Question 4
    30 seconds
    Q. If variable costs are $6 per unit,then total variable costs of producing 7,000 units will be:
    answer choices
  • Question 5
    30 seconds
    Q. The best definition of fixed costs are those that do not vary with:
    answer choices
    number of workers.
  • Question 6
    30 seconds
    Q. The total revenue of a business is:
    answer choices
    the same as profit
    equal to total costs
    quantity of units produced times unit production cost
    quantity of units sold multiplied by the sellingprice.
  • Question 7
    30 seconds
    Q. The break-even level of output is that number of units where:
    answer choices
    profit is at its highest level
    variable costs equal revenue
    total costs equal revenue
    variable costs equal fixed costs
  • Question 8
    30 seconds
    Q. A product sells for $14. Variable costs are $6.Fixed costs are $120,000. Break-even output is:
    answer choices
    15,000 units
    120,000 units
    40,000 units
    we cannot tell from the information given.
  • Question 9
    30 seconds
    Q. The best definition of the contribution made by a product is:
    answer choices
    the profit made on each item sold
    the revenue gained from selling each item
    the difference between price and variable cost
    the difference between price and fixed cost
  • Question 10
    30 seconds
    Q. Which of the following is the best definition of economies of scale?
    answer choices
    Costs fall as output increases.
    Costs per unit fall as the firm expands.
    Average costs rise as the firm expands.
    Fixed costs fall as output increases.
  • Question 11
    30 seconds
    Q. ‘A detailed financial plan for the future’ is a definition of which of the following terms?
    answer choices
    scatter diagram
    sales revenue forecast
    a budget
    estimate of production costs.
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