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24 Cards in this Set
- Front
- Back
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Formula:
Total Revenue |
Price X Output
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Formula:
Total Profit |
Total Revenue - Total Cost
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Formula:
Average Product |
Total Product / Labor Input
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Formula:
Marginal Product |
Change in Total Product
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Question:
When Marginal Product (MP) is above Average (AVG) Product AVG Product will? |
AVG Product will increase. When MP is < AVG Product AVG Product will decrease.
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Formula:
Economic Profit |
Total Revenue - Explicit Cost - Implicit Cost
OR Total Revenue - Economic Cost |
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Formula:
Average Product (AP) |
Total Profit / Labor
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Formula:
Marginal Product (MP) |
Change in Total Product / Change in Labor
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Formula:
Fixed Cost (FC) |
Usually given... Any cost that does not change.
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Formula:
Variable Cost (VC) |
Usually given... Any cost that changes.
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Formula:
Total Cost (TC) |
Fixed Cost + Variable Cost
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Formula:
Average Fixed Cost (AFC) |
Fixed Cost / Quantity
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Formula:
Average Variable Cost (AVC) |
Variable Cost / Quantity
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Formula:
Average Total Cost (ATC) |
Fixed Cost + Variable Cost / Quantity
OR Total Cost / Quantity. |
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Formula:
Marginal Cost (MC) |
Change of Total Cost / Change of Quantity.
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Question:
Perfect Competitions are defined by? |
Number of firms
Type of product Ease of entry and exit |
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Question:
What makes perfect competition? |
Large number of firms
Homogeneous product Easy enter and exit |
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Formula:
Average Revenue |
Total Revenue / Quantity
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Definition:
Marginal Revenue is... |
The additional revenue received by the firm by selling one more unit of the output...
change of TR / change of Quantity |
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Question:
What are the three questions that must be answered by the firm? |
1) Should we produce
2) if so, how much should we produce 3) What is our profit or loss? |
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Question:
What is are characteristics of a Monopoly? |
Single Firm
Unique product Complete barriers to entry |
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Question:
What are characteristics of Monopolistic Competition? |
Many firms
Heterogeneous product Relatively easy entry and exit. |
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Question:
What are characteristics of an Oligopoly? |
Few firms
Homogeneous or heterogeneous product High barriers to entry |
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True or False:
Perfectly Competitive firms yield a perfectly elastic demand curve? |
True
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