vocab
Explicit cost definition
What are payments paid by firms for using the resources of others?(out of pocket costs)
In stage 1 of long run when increasing marginal returns what is known.
Each additional worker is increasingly more productive given quantity of output can be produced with fever, variable input MP is in increasing DP is increasing at an increasing rate
Many small firms, identical products, easy to enter an exit industry. No need to advertise Price acres. No control over price.
Perfect competition
Optimal use of society, scarce resources, perfect competition forces firms to use limited resources to the fullest is called.
Efficiency
When output is increasing at a faster rate than all input
what is increasing returns to scale?
The opportunity cost that firms pay for using their own resources
What is implicit cost?
This happens in stage 2
What is Decreasing marginal returns
In a perfectly competitive market Marginal revenue= what?
What is price
When only variable inputs can be altered, some inputs are fixed plant capacity is fixed there are both fixed and variable cost. It is what.
What is short run
When output is increasing at a slower rate than all inputs
What is decreasing returns to scale?
Total revenue definition
What is the total amount of money a firm receives by selling goods or services?
Stage three, where workers are getting in each other’s way TP is decreasing and MP is negative. This is called.
What is negative marginal returns.
Mr=MC is called.
Profit maximizing rule.
All inputs can be altered. No inputs are fixed plant capacity can be altered. All costs are variable is a description of blank.
What is long run?
When output is increasing at the same rate as all inputs
What is constant return to scale
Look at explicit and implicit costs
economic profit = total revenue minus economic costs(explicit and implicit)
What is economist?
This is a result of fixed recourses, not laziness
Lot of diminishing marginal returns.
Where is MR when in profit.
MR is above ATC
Which of the following must be true of the long run?
A. It is at least one year in duration
B. All factors of production are variable.
C. At least one factor of production is fixed.D. Marginal costs are constant.
B. All factors of production are variable.
Investing in more physical capital.
What are long run decisions?
Firm sell their products at a price from the market
What is price taker?
Economies of scale, definition
The cost advantages that a business obtain due to expansion, ATC Falls, as output increases because of mass production techniques
What equals what, in long run equilibrium
Price=MC= minimum ATC
TC=TR
If the average variable cost of producing five units of a good is $100 and the average variable cost of producing six units is $150 then the marginal cost of increasing output from 5 to 6 units is?
What is $400.
a manufacturing company increases all its inputs by 50% each. If it’s output increases by 100%, then it is experiencing blank.
Increasing returns to scale