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UA / Economics / EC 110 / What are the fixed costs?

What are the fixed costs?

What are the fixed costs?


School: University of Alabama - Tuscaloosa
Department: Economics
Course: Principles of Microeconomics
Professor: Tao yeh
Term: Fall 2016
Tags: Microeconomics
Cost: 25
Name: Ch. 7 Notes
Description: These notes are for Ch. 7 of Microeconomics as offered by the University of Alabama.
Uploaded: 10/15/2016
2 Pages 106 Views 5 Unlocks

) Study

What is fixed costs?

Chapter 7: Production, Inputs, and Cost Vocabulary:

• Fixed costs Short run oTotal Physical Product

• Variable Cost oLong run 4. Average Physical Product.

• Marginal Physical Product Marginal Revenue Product and

• Law of Diminishing Returns o marginal Cost oTotal costs ar o Total Fixedl Variable Costs - Average cost omarginal Cost o Average Fixed / Variable costs Increasing Returns to scale.

Costs are minimized when?

• Constant Returns to Scale Decreasing Returns to Scale vo po Definitions: oFixed Costs: the costs of inputs whose quantity does not vary with output and which are incussed even when output is O.

o Variable Costs: costs which change with output. notes If you want to learn more check out Define the expectancy theory.

• Short Run: a time horizon within which only variable inputs

What is variable costs?

can be adjusted while fixed inputs remain unchanged. antoa

• Long Run: a time horizon within which both fixed and variable inputs can be adjusted. cold son los son

•Total Physical Product & the total output obtained from a

given quantity of input. (TPP) er ein Jeram nein

• Average Physical Product (APP): When x = quantity of input,

APP = TPPIX lo marginal Physical Procluct: (mep) the increase in total output Don't forget about the age old question of If a brother or sister is naked and destitute of daily food, and one of you says to them, "depart in peace, be warmed and filled," but you do not give them the things needed for the body, what does it profit?

resulting from one unit increase in the input mpp: ATPPI AX lo marginal Revenue Product (MRP): the increase in total revenue

that results from a one unit increase in input. MRP mppx price of outpu

Law of Diminishing Returns: as one variable input is increased while all others remain fixed, a point will be reached beyond which the map of the input will begin to decrease. lo marginal Cost: the increase in cost which results from raising Don't forget about the age old question of What are the two stages of periodontal disease?

output by one unit, me ATC/AQ

•Total Costs (TC): payment to all inputs. TC = TFC + TVC

• Total Fixed / Variable costs: payment to fixed variable inputs.

• Average Cost : TC IQ, AC= AFC 8+ AVC We also discuss several other topics like To what extent is society responsible for poverty?

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ol bro, sinontanborror vegan Definitions: o Average Fixed Variable Cost: ALENCIQ crea bexig. o marginal Costo mc = ATC IAQ = ATVCI AQ droo edonor o Increasing Returns to Scale : (IRS) when all inputs are m increased by the same proportion, output rises by more than that proportion (note: this curve has a negative slope). o Constant Returns to Scale CCRS): when all inputs change a by the same proportion, output changes by exactly the If you want to learn more check out Why does worldwide goat is the most consumed meat?

same proportion. (note: this curve is a horizontal line). N o

• Decreasing Returns to scale CD RS): when all inputs change by the same proportion, output changes by less than that

proportion (note: this curve has a positive slope). Ant main Ideas para dona mirtius rosinon ont som hon o o Optional Production: the firm should hire input until

MRP = price of input wie noriran ventor odprode o marginal - Average Rules: barilo sa oras canon eonroe If you want to learn more check out What are the excellent sources of vitamin c?

some must equal AC when AC is at its minimushoto

o When mc>AC, AC is rising. It tagaito tirous novel

too. When meLAC, AC is falling. Du bord serat your la a

• Cost-Minimization of Two Inputs

also 2 999 tugto costs are minimized when tussen onprange

XAISITA 929 x MPPA MPPB tion and wood priti Nest

Sou In other words, when product per dollar is equal for

be bothinputs, cost is minimized, prven o - croped boder so vies trigo mox it and events o n

9220bo odres Jugewoon

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