eco test 2 definitions - Total Revenue Total Cost Explicit...

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Total Revenue The amount a firm receives for the sale of its output Total Cost The market value of the inputs a firm uses in production Explicit costs Input costs that require an outlay of money by the firm Implicit costs Input costs that do not require an outlay of money by the firm (opportunity costs) Economic Profit Total revenue minus explicit costs minus implicit costs= TR – EC – IC Accounting Profit Total revenue minus explicit costs=TR-EC Marginal Cost The increase in total costs that arises from an increase in an extra unit of output Profit Maximization Firms operating in all market structures will maximize profits at the Quantity where MR= MC Monopoly A firm that is the sole seller of a product without close substitutions Legal Monopoly Monopolies that arise because the government has given one person or firm the exclusive right to sell some good or service (May be for public interest or to facilitate research and development. Monopoly
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eco test 2 definitions - Total Revenue Total Cost Explicit...

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