ECON1 - 0410

ECON1 - 0410 - Long-run supply-Suppose profits didn’t...

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Economics 1 4/10/2009 Sunk (fixed) cost - Fishermen pay 10 for gas - If price is 3, they can’t cover cost - If price is 30, they make a profit - Does fixed cost affect short-run supply? - No, selling less doesn’t reduce cost. Selling more doesn’t increase it Sunk Cost and Opportunity Cost - Given that, what opportunities do you forgoe by catching and selling a fish?
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Unformatted text preview: Long-run supply-Suppose profits didn’t even out over time. What would happen?\-Some fisherman would decide not to go out. $10 gas is not a sunk cost now. Total Revenue-From session 1 to session 2, supply went up but total revenue went down-From Question 3 to Question 4, supply went up and total revenue went up, also...
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This note was uploaded on 06/03/2009 for the course ECON ECON 1 taught by Professor Crouch during the Spring '09 term at UCSB.

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