Term
What is total utility vs. marginal utility?
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Definition
Total Utility-total satisfaction consumer gets from consuming a certain amount of a good
Marginal Utility-additional utility a person recieves from consuming an additional unit of a particular good. |
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Term
| What is the law of diminishing marginal utility? |
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Definition
| The marginal utility gained by consuming equal successive units of a good will decline as the amount consumed increases. |
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Term
| What can cause a shift in the cost curves? |
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Definition
| Taxes, Input Prices, and Technology |
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Term
- What are economies of scale?
- What are diseconomies of scale?
- What is the minimum efficient scale
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Definition
- Occurs when imputs increase but outputs increase more causing unit costs to fall
- Occurs when inputs increase more than output causing unit costs to rise
- It is the lowest output at which average total costs are minimalized.
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Term
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Definition
It is when there is zero economic profit. The firm is earning revenues equal to its total opportunity costs.
Level necessary to keep resourced employed at firm. |
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Term
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Definition
| Total revenue-explicit costs |
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Term
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Definition
| total revenue-(explicit + implicit costs) |
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Term
For the short run period of production, what is:
- The INPUTS
- COSTS ASSOCIATED WITH INPUTS
WHAT ABOUT FOR THE LONG TERM |
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Definition
Short Run
- fixed and variable
- fixed costs and variable costs
Long Term
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Term
| What is the marginal physical product? |
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Definition
| The change in output that results from changing the variable output by 1 unit, ceteris paribus |
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