The Private Firm

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Average Cost
Total cost/output
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Average fixed costs
Downward sloping line (from left to right) as the fixed costs are shared amoung increasing output
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Average revenue
total revenue/quantity sold
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Average variable
Initially downward sloping as increasing returns to labour and economies of scale are achieved with increased output and then they rise with output
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Break-even point
total revenue = total cost (no profit or loss made)
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Co-operative
Organisation owned by its workers and they share the rewards
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Costs
the money paid to produce the g/s
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Diseconomies of scale
When an increase in the scale of production results in increased average costs
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Diminshing returns to labour
the allocation of workers to specific tasks in the production line
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Division of labour
the allocation of workers to specific takes
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Economies of scale
When output increases leads to reduced total average costs
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Firm
The company/business that owns one or more factories
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Fixed Costs
Have to be paid regardless of levels of production
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Horizontal integration
merging firms at the same stages of production
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Increasing returns to labour
initially as additional workers are employed their marginal output increases
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Industry
A group of firms producing similar or same goods
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Marginal cost
The additional cost of producing an extra unit
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Marginal product
Additional output gained from the employment of an additional worker
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Marginal Revenue
The additional revenue gained from selling an extra unit
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Monopoly
Single firm controls the supply in a market with no competitors
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Multinational Co-orporation
Company that has outlets in more than one country
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Normal Profit
Profit level just high enough to keep firms in the industry
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Oligopoly
Small number of large companies control the market
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Partnership
A jointly owned business
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Primary Industry
Extracting raw materials
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Private Limited Company
Owned by shareholders, but shares are sold privately not on the stock exchange
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Productivity
Output per worker
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Profit
Revenue - costs
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Public Limited Company
Owned by the shareholders from the stock exchange
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Revenue
Total money obtained from sales
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Secondary industry
Manufacturing or construction
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Sole-trader
Single owner of a buiness, usually small scale
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Super-normal profit
Increased demand in an industry leads firms to make above normall profits
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Tertiary industry
Provide a service
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Total Cost
Fixed costs + variable costs
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Total Revenue
Price X Output
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Variable costs
Dependent on the level of production
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Vertical Intergration
merging of firms that are involved in the production of the same product but a different stages
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Other cards in this set

Card 2

Front

Downward sloping line (from left to right) as the fixed costs are shared amoung increasing output

Back

Average fixed costs

Card 3

Front

total revenue/quantity sold

Back

Preview of the back of card 3

Card 4

Front

Initially downward sloping as increasing returns to labour and economies of scale are achieved with increased output and then they rise with output

Back

Preview of the back of card 4

Card 5

Front

total revenue = total cost (no profit or loss made)

Back

Preview of the back of card 5
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