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14 Cards in this Set
- Front
- Back
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Total Revenue |
The amount that the firm receives for the sale of its output |
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Total Cost |
The amount that the firm pays to buy inputs (flour, sugar, workers, ovens, etc.) |
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Economic Profit |
Total Revenue - Opportunity Cost (explicit and implicit) of producing the goods and services sold |
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Accounting Profit |
Total Revenue minus only the firm's explicit costs |
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Marginal Product |
The increase in the quantity of output obtained from one additional unit of that input |
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Fixed Cost |
Set-cost, expenses that do not change |
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Variable Cost |
Cost that vary at the level of output |
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Average Total Cost |
Total Cost / Quantity of outputs |
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Average Fixed Cost |
Fixed Cost / Quantity of the outputs |
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Average Variable Cost |
Variable Cost / Quantity of the outputs |
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Marginal Cost |
Cost it takes to increase a unit by 1 |
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Economies of Scale |
When long-run average total cost declines as output increases |
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Diseconomies of Scale |
When long-run average total cost rises as output increases |
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Constant Returns to Scale |
The property whereby long-run average total cost stays the same as the quantity of output changes |
