term1 Definition1term2 Definition2term3 Definition3
Please sign in to your Google account to access your documents:
Entry and Exit Decisions in the Long-run
Firms will enter when P > AC
Exit when P < AC
Normal Profit
When economists say 0 profits, they mean what normal people mean by normal profits
Sunk costs on entry and exit
Sunk costs are incurred and can never be recovered.
Do not enter unless the the price of a good > min AC long enough to cover entry costs
Exit when you are certain a price of a good will be < min AC in the long-run otherwise go thru it in short-run.
Increasing Cost Industries
An industry where it is exactly difficult to duplicate outputs
E.g. Oil, coffee, copper, gold, silver, nuclear engineers
Need help typing ? See our FAQ (opens in new window)
Please sign in to create this set. We'll bring you back here when you are done.
Discard Changes Sign in
Please sign in to add to folders.
Sign in
Don't have an account? Sign Up »
You have created 2 folders. Please upgrade to Cram Premium to create hundreds of folders!