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15 Cards in this Set
- Front
- Back
Marginal Cost
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Added cost per unit of output produced
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Fixed Cost
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Costs resulting from fixed inputs
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Marginal Benefits
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Extra benefits from, for example, increased consumption of commodity
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Marginal Revenue
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Extra revenue received by firm for selling one added unit of good
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Marginal Product
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AMOUNT OUTPUT INCREASES w/ addition of 1 unit of output
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Price Taker
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Firms that take price of good or service they sell as given; PRICE IS UNAFFECTED BY THE LEVEL OF PRODUCTION FROM THESE FIRMS
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Perfect Competition
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When each firm is a price taker—no firm can influence market price; At market price, firm can sell as much as they want, BUT LOSES ALL SALES IF RAISE PRICE
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Average Cost
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Total Costs DIVIDED by Total Ouput
TC/Q |
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Average Variable Costs
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Total variable costs DIVIDED by total output
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Externality
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Occurs when firm/individual takes action but doesn't bear all costs (negative externalities) or all benefits (positive externalities)
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Private Marginal Cost
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Marginal cost of production borne by producer of good
In case of negative externality: private marginal cost is less than social marginal cost |
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Total Costs
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Sum of all fixed costs and variable costs
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Variable Costs
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Costs resulting from variable inputs
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Transaction Costs
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Extra costs (beyond price of purchase) of conducting a transaction, whetehr they are money, time, financial.
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Revenue
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Amount firm receives from selling its products
price received X quantity sold |