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Definition
| opportunity cost of resources employed by a firm that takes the form of cash payments |
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a firm's opportunity cost of using its own resources or those provided by its owners w/o a corresponding cash payment |
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| a firms total revenue minus its explicit costs |
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| a firm's total revenue mius its explicit and implicit costs |
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| the accounting profit earned hen all resources earn their opportunity cost |
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| any resource that can e caried in the shourt run to increase or decrease production |
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| any resource that cannot be varied in the short run |
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| a period during which at least one of a firm's resources is fixed |
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| a period which all resources under the firm's control are variable |
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| the relationship between the amount of resoures employed and a firm's total product |
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| the change in total product that occurs when the use of a particular resource increases by one unit, all other resources constant |
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| increasing marginal returns |
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Definition
| the marginal product of a variable resources increases as each additional unit of that resource is employed |
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| law of diminishing marginal returns |
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Definition
| as more of a variable resource is added to a given amount of another resource, marginal, product eventually declines and could become negative |
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| any production cost that is independent of the firm's rate of output |
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| any production cost that changes as the rae of output changes |
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Definition
tc= fc+vc fc=fixed cost vc=variable cost |
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mc= change of tc change of q |
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Definition
| forces that reduce a firm's average cost of the scale of operation increases in the long run |
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| forces that may evenually increase a firm's average cost as the scale of operation increases in the long run |
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Term
| long-run average cost curve |
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Definition
| a curve that indicates the lowest averae cost fo production at each rate of output when size, or scale, of the firm varies |
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| constant long-run average cost |
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Definition
| a cost that occurs when, over some range of output, long-run average cost niether increases nor decreases with change in firm size |
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Term
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Definition
| the lowest rate of output at which a firm takes full advantage of economies of scale |
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