Definitions pt.2
How much of something can a company produce
What is a Production Function
TP
What is Total Product
TR-(Explicit costs +Implicit costs)
What is Economic Profit
VC
What is Variable Cost
AP
What is Average Product
Cannot be changed in the short run to change production
What are Fixed Inputs
ATP
What is Average Total Product
The minimum compensation that justifies a company
What is Normal Profit
MR
What is Marginal Revenue
ATC
What is Average Total Cost
The amount of time where a firm can only change variable inputs
What is Short Run
TR>TC
What is Product Determination
Equal to Normal Profit
What is Zero Economic Profit
AVC
What is Average Variable Cost
What is Average Fixed Cost
A firm's maximum potential level of production
The way a firm combines inputs to produce an output
What is a Production Function
The price, input and output levels that will lead to the highest possible total profit
AFC
What is Average Fixed Cost
VC/Q
What is Average Variable Cost
When Long run ATC is constant as output increases
What is Constant Returns to Scale
TP/L
What is Average Product Formula
When a firm earns a profit
What is TR>TC
LRATC
TC/Q
What is Average Total Cost