True or False

_____ 1. Economic Efficiency is the technically efficient method with the highest production cost to the business firm.

_____ 2. The Law of Diminishing Returns stipulates that for every additional input (variable) to a fixed input, output increases in a diminishing rate. _____ 3. In the irrational production stage, MP is already negative, TP and AP decreased.

_____ 4. Isocosts are non-intersecting and non-tangent. Isocosts have the same properties as consumers' indifference curves.

_____ 5. Long-run cost, LAC is the cost of adjusting all factors of production, including plant capacity.

II. Multiple Choice. _____ 1. In the function, Q = f(L), any changes in the input L would result to a change in the output Q. Labor (L) here is a (variable, fixed, constant) input.

_____ 2. The saturation point in production curve shows the TP that is (increasing, constant, decreasing).

_____ 3. The symbolic equation of total cost is, TC = TFC + TVC. In graphs the curve that is represented by a straight horizontal line is ( TC, TFC, TVC).

_____ 4. Diseconomies of scale means the (increase, decrease, constant) in output of the firm is

___ 5. (less than, greater than) proportionate to the increase in input of the firm.