production

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total revenue minus the explicit costs of production is ____ profit

accounting

in making a decision about how much output it should produce to maximize its profits, which two pieces of information does a firm need?

The extra benefit of producing that unit; the extra cost associated with producing an additional unit of output

the short run is

a period of time in which at least one input of production is fixed

zero_____profit means that the value of economic profit is negative

accounting

marginal product is the

additional output produced as a result of utilizing one more unit of a variable resource

average product is the

amount of output produced per unit of a resource employed

in addition to total cost, it is useful to calculate average total cost because

average cost can be compared directly to the price, average cost numbers are more useable for managing

total fixed cost divided by the amount of output produced is equal to

average fixed cost

total cost per unit is equal to

average total cost

Variable cost per unit is equal to

average variable cost

total variable cost divided by the amount of output produced is equal to

average variable cost

monetary payments made by individuals, firms, and governments for the use of others' land, labor, capital, and entrepreneurial ability are ______ costs

explicit

Total revenue minus the total _____ and total _____ costs of production is economic profit

explicit and implicit

economic costs can be defined as the sum of ____ and ___ costs

explicit; implicit

marginal cost is the

extra or additional associated with the production of an additional unit of output

total cost equals _____ cost plus total_____ cost

fixed; variable

the opportunity cost of using owned resources are ____ costs

implicit

the shape of the marginal cost curve is dependent on the

law of diminishing marginal returns

average _____ cost always declines as a firm produces more output

marginal

decreasing _____ returns are a characteristic of production whereby the marginal product of the next unit of a variable resource utilized is less than that of the previous resource

marginal

increasing _____ returns is a characteristic of production whereby the marginal product of the next unit of a variable resource utilized is greater than that of the previous variable resource

marginal

when the ___ cost falls below the ____ cost, the average cost should be decreasing

marginal; average

zero accounting profit means that the value of economic profit is

negative

costs that change the amount of _______ produced are variable costs

output

costs that do not change with the amount of ______ produced are fixed costs

output

total revenue equals

price times quantity

The total amount of output produced with a given amount of resources is known as the total

product

being able to calculate total product, average product, and marginal product is important

to operate efficiently and maximize profits

negative _____ profits encourage firms to exit the market

economic

positive ______ profits encourage more firms to enter the market to produce goods and services

economic

total revenue minus the explicit and implicit costs of production is _____ profit

economic

zero _____ profit is the revenue needed for a company to break even and meet operating costs without a loss

economic


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