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10 Cards in this Set

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Pure Competition

large number of firms producing one standardized product. Exit and entry into the industry is very easy

Pure Monopoly

One firm is the sole seller of a product. The additional firms are blocked from entry. This allows one firm to contsitute the industry. Produces a single product

Monopolistic Competition

Large number of sellers producing differentiated products. There is widespread nonprice competition. it is a selling strategy that distinguishes its product on the basis of attributes like design. exit and entry are easy

Oligoply

few sellers of a standardized or differentiated product, each firm is affected by the decisions of its rivals. must take other firms decisions into acount when determining its price and output

Fixed costs

costs that do not change or vary with changes in output. (rental payments, interest on debts). Can not be controlled in the short run and must be paid regardless of output.

Variable Costs

costs that change with the level of output (payments for fuel, transporation) every unit of output that increases the total variable cost is no the same every time. Can be controlled in the short run

Total cost

the sum of the fixed cost


TC=TFC+TVC

Average Variable Cost

At any output level is calculated by dividing TVC by the output level (Q)


AVC=TVC/Q

Average Fixed Cost

AFC-TFC/Q

Average Total Cost

ATC=TC/Q or ATC=TFC/Q+TVC/Q