Econ100B Lecture6 - 4-17

Econ100B Lecture6 - 4-17 - Economics 100B: Lecture 6 S....

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Economics 100B: Lecture 6 S. Nageeb Ali April 17, 2008
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Economics 100B: April 17, 2008 Where we were s Shape of long-run average cost curves b If production function is CRS, AC(q) = constant s No economies of scale b Sometimes U-shaped s Initially economies of scale : AC(q) falls as q increases b Increased specialization, greater efficiency s Eventually diseconomies of scale : AC(q) increases as q increases b Coordination problems, management inefficiencies
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Economics 100B: April 17, 2008 LR Cost Curve for CRS
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Economics 100B: April 17, 2008 Shape of LR Curve
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Economics 100B: April 17, 2008 Learning by Doing s Practice makes perfect
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Economics 100B: April 17, 2008 Gym Memberships s Temptation for relaxation; not strenuous physical activity b Self-control problem b Pre-commitment: join the military, sign up for boot camp b Join health club s In 2001, 17,000 health clubs with 32 million members and annual revenue of $11.6 billion b Offer monthly and annual membership contracts b Initiation fees b Also pay-per-visit fee
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This note was uploaded on 07/22/2008 for the course ECON 100B taught by Professor Rauch during the Spring '07 term at UCSD.

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Econ100B Lecture6 - 4-17 - Economics 100B: Lecture 6 S....

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