Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
13 Cards in this Set
- Front
- Back
|
A time period in which quantities of one or more inputs cannot be changed. (The firm has fixed inputs).
|
short-run
|
|
|
Amount of time needed to make all inputs variable.
|
long-run
|
|
|
Change in K / Change in L
|
MRTS
|
|
|
Convex isoquants means that the MRTS is ____________ as you move down along an isoquant (replacing capital with labor)
|
diminishing
|
|
|
a proportionate increase in all input quantities resulting in a greater than proportionate increase in output
|
increasing returns to scale
|
|
|
a proportionate increase in all input quantities simultaneously that results in the same percentage increase in output
|
constant returns to scale
|
|
|
a proportionate increase in all input quantities resulting in a less than proportionate increase in output
|
decreasing returns to scale
|
|
|
technological progress that decreases the amounts of labor and capital needed to produce a given output, without affecting the marginal rate of technical substitution of labor for capital
|
neutral technological progress
|
|
|
technological progress that causes the marginal product of capital to increase relative to the marginal product of labor
|
labor-saving technological progress
|
|
|
technological progress that causes the marginal product of labor to increase relative to the marginal product of capital
|
capital-saving technological progress
|
|
|
lines representing all input combinations that cost the firm the same amount
|
isocost lines
|
|
|
slope of isoquant = slope of isocost line
|
cost-minimizing condition
|
|
|
a line that connects the cost-minimizing input combinations as the quantity of output, Q, varies, holding input prices constant
|
expansion path
|
