Perfect Competition
Cost of the Firm
Long Run
Short Run
Rose Run
100
takes its price from the industry, and is, consequently
What is price takers
100
Change in total product ____________________ Change in Input
What is Marginal Product
100
all resources are variables
What is long run
100
In manufacturing industries such as motor vehicles and DVD players, it is straightforward to measure how much output is being produced. But in service or knowledge industries, where output is less “tangible” it is harder to measure productivity.
What is total product
100
what is your teacher name
What is Ms. Rose
200
free-market situation in which the following conditions are met: (1) buyers and sellers are too numerous and too small to have any degree of individual control over prices, (2) all buyers and sellers seek to maximize their profit (income), (3) buyers and seller can freely enter or leave the market, (4) all buyers and sellers have access to information regarding availability, prices, and quality of goods being traded, and (5) all goods of a particular nature are homogeneous, hence substitutable for one another.
What is perfect competition
200
Total Product ___________ Units of Labor
What is Average Product
200
long run average cost falls because mass production techniques are used
What is economies of scale
200
measures output per-worker-employed or output-per-unit of capital
What is average product
200
the creator
What is Kimberly
300
price exceeds average total cost at the quantity that equates marginal revenue and marginal cost
What is profit maximization
300
a period in which at least one resource is fixed
What is short run
300
the long run average total cost is as low as it can get
What is constant returns to scale
300
is the change in output from increasing the number of workers used by one person, or by adding one more machine to the production process in the short run
What is marginal product
300
the part of economics concerned with single factors and the effects of individual decisions
What is microeconomics
400
price is greater than average variable cost but is less than average total cost at the quantity that equates marginal revenue and marginal cost
What is loss minimization
400
Accounting Profit=TR-Accounting Costs (explicit only)
What is Accountants
400
the LRATC is increasing as the firm gets too big and difficult to manage
What is diseconomies of scale
400
states that as we add more units of a variable input to fixed amounts of land and capital, the change in total output will at first rise and then fall
What is law of diminishing returns
400
If the market for this good was in equilibrium at Q2, but the socially optimal output was Q1, the government could best remedy this —— of resources by legislating a ——on ——of the good. a.underallocation, per unit tax, consumers b.overallocation, per unit subsidy, consumers c.underallocation, per unit tax, producers d.overallocation, per unit subsidy, producers e.overallocation, per unit tax, producers
What is E—If equilibrium output exceeds the socially desirable output, resources are overallocated to production of this good. This negative externality can be fixed with a tax on producers or sometimes on consumers.
500
when the revenue received from the sale of the goods or services produced cannot even cover the variable costs of production. In that situation
What is shutdown
500
Economic Profit=TR-Economic Cost (Explicit-Implicit)
What is Economists
500
Economies of scale Constants of scale Diseconomies of scale
What is LRATC Simplified (3 Stages)
500
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What is short run
500
For the perfectly competitive firm, the profit maximizing decision to shut down is made when the price a.falls below minimum average total cost. b.is greater than minimum average variable cost, but lower than minimum average total cost. c.falls below minimum average variable cost. d.is equal to minimum average total cost. e.is equal to average fixed cost.
What is C—This is the shutdown point.
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