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Terms and Definitions (Part I)
Terms and Definitions (Part II)
Equations (Part I)
Equations (Part II)
100
The value of the best alternative surrendered when a choice is made.
What is opportunity cost?
100
Costs that do not vary with output.
What are Fixed Costs?
100
This is the equation used to calculate accounting profit.
What is revenues minus explicit costs?
100
This is another equation used to calculate average total cost.
What is average fixed cost + average variable cost?
200
A period in which at least one input is fixed.
What is the short run?
200
Costs that vary with output.
What are Variable Costs?
200
This is the equation used to calculate economic profit.
What is Revenue minus Total Opportunity Costs (explicit and implicit costs)?
200
This is the equation used to determine total opportunity costs.
What is implicit costs + explicit costs?
300
A period in which all inputs can be varied.
What is the long run?
300
The sum of fixed and variable costs.
What is total cost?
300
This is the equation used to calculate average total cost.
What is total cost divided by quantity of output?
300
This happens to average fixed cost as more units are produced.
What is decreases?
400
The change in output with one additional unit of input.
What is the Marginal Physical Product (MPP)?
400
a past cost that cannot be changed by current decisions.
What is a sunk cost?
400
This is the equation used to calculate average fixed cost.
What is fixed costs divided by quantity of output?
400
This happens to average variable cost as more units are produced.
What is decreases, then increases?
500
The change in total cost that results from producing an additional unit of output.
What is Marginal Cost?
500
An opportunity cost incurred without an expenditure of money.
What is an implicit cost?
500
This is the equation used to calculate average variable cost.
What is variable costs divided by quantity of output?
500
This happens to average total cost as more units are produced.
What is decreases, then begins to increase.