First Lecture After The 3rd Exam
First Lecture After The 3rd Exam ECON 142
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This 1 page Class Notes was uploaded by Mike Meng on Sunday April 5, 2015. The Class Notes belongs to ECON 142 at Kansas taught by Dr. Brian Staihr in Spring2015. Since its upload, it has received 83 views.
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Date Created: 04/05/15
First Lecture After The 3rd Exam 04062015 D For a perfect competition rm who has no control over price D To determine the output level to make the most pro t B When the marginal cost is bigger than the price the pro t starts to go down D We look for the point where the marginal cost is smaller and closest to the price which is the point where the rm is making the most pro t D Or if the company is losing pro t the lost comes smallest when the output level is closest to MC For this rm price marginal revenue P396 Marginal revenue the change in total revenuechange in Quantity The change in total revenue by selling one more good In the case of perfect competition P never change so P MR Where the P come close to the MC P397 In the table and the intersection of two curves in the graph Pro t per unit P ATC the vertical distance between the ntersection between P curve and MC curve and the ATC curve lllllllllllllllll Total unit Pro t per unit number of pro ts The area of the rectangle When a rm is losing pro t due to market price decreasing When P is above AVC the rm keeps producing When P drops down AVC the rm should stop the point intersects by P and AVC is called the shut down point llllllllll D D The MC curve is the competitive rm s supply curve P405 D The shift down of the MC is a right shift of the supply curve B D In the perfect competition market if there is a pro t more and more producers will enter the market and compete the pro t away the supply curve shift right the market price decreases until when P ATC MC no pro t per unit then no pro t D D Zero pro t D In economics we assume the cost calculations contain a reasonable pro t D Zero pro ts mean zero excess pro ts the rm can still run with out those excess pro ts D llll
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