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14 Cards in this Set
- Front
- Back
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UTILITY
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BENEFIT OR SATISFACTION THAT A PERSON GETS FROM THE CONSUMPTION OF A GOOD OR SERVICE
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FIRM
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AN ECONOMIC UNIT THAT HIRES FACTORS OF PRODUCTION AND ORGANIZES THOSE FACTORS TO PRODUCE AND SELL GOODS AND SERVICES
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NORMAL PROFIT
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THE EXPECTED RETURN FOR SUPPLYING ENTREPRENEURIAL ABILITY
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ECONOMIC PROFIT
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A FIRMS' TOTAL REVENUE MINUS ITS OPPURTUNITY COST
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PERFECT COMPETITION
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A MARKET IN WHICH THERE ARE MANY FIRMS EACH SELLING AN IDENTICAL PRODUCT, ETC
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OLIGOPOLY
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A MARKET STRUCTURE IN WHICH A SMALL NUMBER OF FIRMS COMPETE
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MONOPOLY
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A MARKET STRUCTURE IN WHICH THERE IS ONE FIRM, WHICH PRODUCES A GOOD OR SERVICE THAT HAS NO CLOSE SUBSTITUTE, PREVENTION OF ENTRY OF NEW FIRMS.
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4-FIRM CONCENTRATION RATIO
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A MEASURE OF MARKET POWER THAT IS CALCULATED AS THE PERCENTAGE OF THE VALUE OF SALES ACCOUNTED FOR BY THE 4 LARGEST FIRMS IN AN INDUSTRY.
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HERFINDAHL-HIRSCHMAN INDEX
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A MEASURE OF MARKET POWER THAT IS CALCULATED AS THE SQUARE OF THE MARKET SHARE OF EACH FIRM (%) SUMMED OVER THE LARGEST 50 FIRMS OR LESS IN A MARKET.
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SHORT RUN (FIRM)
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PERIOD OF TIME IN WHICH QUATINTY OF 1+ INPUT IS FIXED AND QUANTITIES OF OTHER INPUTS CAN BE VARIED
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SHORT RUN: (INDUSTRY)
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PERIOD OF TIME IN WHICH EACH FIRM HAS A GIVEN PLANT SIZE AND THE NUMBER OF FIRMS IN THE INDUSTRY IS FIXED.
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LONG RUN
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PERIOD OF TIME IN WHICH THE QUANTITIES OF ALL RESOURCES CAN BE VARIED
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SUNK COST
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THE PAST COST OF BUYING A PLANT THAT HAS NO RESALE VALUE
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LAW OF DIMINISHING RETURNS
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AS A FIRM USES MORE OF A VARIABLE INPUT, WITH A GIVEN QUANTITY OF OTHER INPUTS (FIXED), THE MARGINAL PRODUCT OF THE VARIABLE INPUT EVENTUALLY DIMINISHES.
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