Flip It Firms, Production, and Profits Notes - \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf \u25cf Firm an economic institution that uses resources

Flip It Firms, Production, and Profits Notes - u25cf...

This preview shows page 1 out of 1 page.

Firm - an economic institution that uses resources and transforms them into goods and services Firms come in many sizes and structure; they can be small, single-owner operations or they could be large multi-national corporations that use resources from around the globe, or any size in between Regardless of their size and structure, all firms must make one key decision in order to operate: how to use resources effectively to produce their output In choosing the best combination of resources, all firms, have one primary objective: to maximize economic profits Economic profits are calculated by taking total revenue and subtracting all costs, including opportunity costs. Economic Profit = Revenue - Resources - Opportunity Cost All firms must choose the resources they need to produce their output in a way that maximizes economic profits Production Process - occurs when inputs are combined in some way to produce output Production Function

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture