1. How a 1% increase in output affects unit costs
b. How a 10% invrease in output affects total cost
c. How total cost decrease as output doubles
d. How unit costs decrease as output doubles
e. None of the above

2. Given a 50% learning curve, where the first unit costs is $1,000, the cost of the 4th unit would be: 
a. $800
b. $250
c. $500
d. $400
e. None of above

3. Theoretically , in a long-run cost function: 
a. all inputs are fixed
b. all inputs are considered variable
c. some inputs are always fixed
d. capital and labor are always combined in fixed proportions
e. b and d

4. What method of inventory valuation should be used for economic decision-making problems? 
a. Book value
b. Original cost
c. Current replacement cost
d. Cost or market, whichever is lower
e. Historical cost

5. The degree of operating leverage is equal to the ______ change in __________ divided by the _______ change in _____. 
a. percentage; sales; percentage; EBIT
b. unit; sales; unit; EBIT
c. percentage; EBIT; percentage; sales
d. unit; EBIT; unit; sales
e. None of above

6. In the linear breakeven model, the breakeven sales volume (in dollars) is equal to fixed costs divided by: 
a. unit selling price less unit variable cost
b. contribution margin per unit
c. contribution margin per unit
d. target margin per unit
e. none of the above

7. In the linear break-even model, the difference between selling price per unit and variable cost per unit is referred to as: 
a. variable margin per unit
b. variable cost ratio
c. contribution margin per unit
d. target margin per unit
e. None of the above

8. The rate at which one input X may be substituted for another input Y in a production process, while output remains constant, is: 
a. the slope of the isoquant curve
b. the marginal rate of technical substitution
c. Equal to MPX/MPY
d. all of the above
e. none of the above