Econ

Front 1

fixed input

Back 1

one whose qty cannot be randomly changeed during the relevant period of production

Front 2

variable input

Back 2

one whose qty can be randomly changed during the relevant period of production

Front 3

short-run

Back 3

plant size fixed

Front 4

long-run

Back 4

plant size variable

Front 5

production schedule

Back 5

shows output that can be produced using hte fixed and variable inputs

use to derive measures of productivity

Front 6

two measures of productivity

Back 6

1. average product of labor

2. marginal proudct of labor

Front 7

average product of labor

Back 7

firm's output Q divided by the corresponding level of the variable input L

MOST COMMON!!!

Front 8

marginal product of albor

Back 8

change in the firms' output as a result of the firm using one more unit of labor

basically: change in Q over change in L

Front 9

law of diminishing returns

Back 9

as amt of labor used is increased, eventually a point will be reached where using more labor yields diminishign marginal contributions to the total output

DOES NOT MEAN THAT OUTPUT IS DECREASING

Front 10

what determines...
what goods should be produced?

Back 10

price of goods

Front 11

what determines...
how should goods be produced?

Back 11

price of resource

Front 12

what determines...
who receives the goods?

Back 12

incomes

Front 13

characteristics of market economy

Back 13

1. all scarce resources owned by private individuals
2. freedom of enterprise
3. freedom of choice
4. principle of self-interst
5. price system

Front 14

karl marx's view on market econmy

Back 14

1. ignores fundamental conflict b/w labor and capitalists
2. fails to recognize importance of monopoly firms
3. overlooks importance of unemployment

Front 15

productin possibilities curve

Back 15

shows all combinations of two goods a society could produce with full and efficient employment of its resources

Front 16

assumptions about PPC

Back 16

1. economy is operating at full employment and production
2. avail amt of economy resources is fixed
3. technology is constant

Front 17

cost of goods

Back 17

how many units of good Y a society must give up to produce one more unit of good X

Front 18

law of increasing cost

Back 18

as the amt of good X produced is increased, the amt of good Y that must be given up will continually increase

Front 19

market demand

Back 19

schedule that shows at each price of the product how many units all the consumers in the market would be willing to purchase during a specified time period

Front 20

fundamental law of demand

Back 20

more of a good will always be purchased at a lower price than at a higher price

Front 21

non-price determinants of demand

Back 21

1. income
2. price of related goods
3. tastes or preferences
4. number of buyers in market
5. consumer expectations about future prices
6. advertising

Front 22

change in demand

Back 22

change in non-price determinant of demand

causes SHIFT in demand curve

Front 23

change in quantity demanded

Back 23

only if price of product changes

causes MOVEMENT ALONG demand curve

Front 24

supply

Back 24

schedule which shows at each price the product P how amny units of the product all the sellers in the market are willing to sell during a specified time period

Front 25

non-price determinants of supply

Back 25

1. number of sellers
2. technology
3. price of resources
4. price of other goods suppliers can produce
5. seller expectations about future prices

Front 26

change in supply

Back 26

change in non-price determinant of supply

causes a SHIFT in supply curve

Front 27

change in quantity supplied

Back 27

price of product changes

causes MOVEMENT ALONG same supply curve

Front 28

price ceiling

Back 28

price mandated by govt below the market price

Front 29

price support

Back 29

price mandated by govt above the market price

Front 30

price elasticity of demand

Back 30

number which measures responsiveness the purchases of a good resulting from a change in its price

Front 31

good X tends to be relatively more elastic...

Back 31

1. larger the number of substitues for good X
2. closer the substitutes
3. greater the portin of a consumer's income needed to purchase good X
4. longer the time period a consumer has to produce good X

Front 32

good X tends to be relatively more inelastic...

Back 32

1. smaller the number of subs
2. very few close subs
3. smaller the protion fo a consumer's income needed to purchase good X
4. shorter the time period a consumer has to purchase good X

Front 33

who pays the tax ths more inelastic the supply?

Back 33

sellers

Front 34

who pays the tax the more inelastic the demand?

Back 34

consumers

Front 35

fixed costs

Back 35

those which remain the same regardless of the level of output

Front 36

varaible costs

Back 36

costs which incrase w/ level of firm's output

Front 37

short run costs

Back 37

fixed costs
variable cost

Front 38

marginal cost

Back 38

change in the firm's total cost as a result of firms producing one more unit of output

Front 39

long run average cost curve

Back 39

shows plant size that has lowest per-unit cost of producing a given level of output

Front 40

economies of scale

Back 40

cost-saving due to size

Front 41

diseconomies of scale

Back 41

cost increasing due to size

Front 42

optimal plant size

Back 42

plant size that has the lowest per unit cost of producing only level of output