AP Economics Chapter 13 Key Terms March 5, 208

AP Economics Chapter 13 Key Terms March 5, 208 - 12....

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AP Economics Chapter 13 Key Terms 1. Total revenue (for a firm) – the amount a firm receives for the sale of its output. 2. Total cost – the market value of the inputs a firm uses in production. 3. Profit – total revenue minus total cost. 4. Explicit costs – input costs that require an outlay of money by the firm. 5. Implicit costs – input costs that do not require an outlay of money by the firm. 6. Economic profit – total revenue minus total cost, including both explicit and implicit costs. 7. Accounting profit – total revenue minus total explicit cost. 8. Production function – the relationship between quantities of inputs used to make a good and the quantity of output of that good. 9. Marginal product – the increase in output that arises from an additional unit if input. 10. Diminishing marginal product – the property whereby the marginal product of an input declines as the quantity of the input increases. 11. Fixed costs – costs that do not vary with the quantity of output produced.
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Unformatted text preview: 12. Variable costs – costs that vary with the quantity of output produced. 13. Average total cost – total cost divided by the quantity of output. 14. Average fixed cost – fixed costs divided by the quantity of output. 15. Average variable cost – variable costs divided by the quantity of output. 16. Marginal cost – the increase in total cost that arises from an extra unit of production. 17. Efficient scale – the quantity of output that minimizes average total cost. 18. Economies of scale – the property whereby long-run average total cost falls as the quantity of output increases. 19. Diseconomies of scale – the property whereby long-run average total cost rises as the quantity of output increases. 20. Constant returns to scale – the property whereby long-run average total cost stays the same as the quantity of output changes....
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This note was uploaded on 10/19/2010 for the course ECON 201 taught by Professor Coomber during the Spring '08 term at Community College of Baltimore County.

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AP Economics Chapter 13 Key Terms March 5, 208 - 12....

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