Total revenue
Fixed costs
costs that do not vary with output
Fixed capital
refers to the factories, offices, shops, machines, tools, equipment and furniture used in the production
Productivity
the amount of output that can be produced with a given quantity of resources
Average revenue
the average amount of money a firm receives from selling one unit of output AR = TR/output
Profit
the difference between total revenue and total costs Profit = TR-TC
Factors of production
the resources used to produce goods and services. They include land, labour, capital and enterprise
Average costs
the total costs divided by the pit[it (this has a diagram) AC = TC/output
Human capital
the value of an individual worker to a business
Total revenue
total receipts of a firm from the sale of any given quantity of a product
Variable costs
vary directly with output ( e.g. wages and raw materials)
Labour intensive
where production relies more heavily on labour relative to machinery
Capital intensive
where production relies more heavily on machinery relative to labour
Production
a process that involves converting resources into goods or services
Production
a process which involves converting resources into goods or services
Total costs
all the costs of producing a good or service added together TC= FC+VC
Working capital
also called circulating capital, stocks of raw materials and components that will be used up in the production
Entrepreneur
an individual who organizes the other factors of production and risks their own money in a business venture