Economics 7

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  • Created by: Gabrielle
  • Created on: 29-12-13 18:24
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  • Costs
    • Total Costs
      • The market value of the inputs a firm uses in production
    • Opportunity costs
      • The cost of something is what you give up to get it
      • Explicit costs
        • the input costs that the firm needs to buy
    • Economic Profit
      • Total revenue - all the opportunity costs (explicit & implicit)
    • Production Function
      • the amount of output which can be produced given different combinations of factor inputs
        • Some factors of production cannot be changed in the short run
        • All factors can be altered in the long run
      • Marginal product
        • The increase in quantity of output obtained from one additional unit of an input
    • Fixed and Variable Costs
    • Diseconomies of scale
      • Long-run average total cost rises as the quantity of output increases


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