Lecture 13 Pegs

Lecture 13 Pegs - Lecture 13 Pegs 15:01 The firm: a profit...

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Lecture 13 Pegs 15:01 The firm: a profit maximizing organization Common motivation o Primary strategy: Maximize profits o Different firms need a common object o No common objective – no way to talk about the theory of the firm bc there  are multiple theories.  o Having the objective (example) of a fair rate of return, fair social  responsibility  Chartered by government – should be social responsible o Community interests o Stakeholders o Not only shareholders Cost categories With costs that are fixed, variable , average and marginal. Fixed Cost – FC Don’t vary without output No matter what output what ever costs that don’t change are fixed costs Example o Corner in front of mincers – if mincers sells 10 or 50 t shirts –cant  distinguish between the wear and tear of the building. The building does  not cost mincers anymore  - no matter how many t shirts they sell. 
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Lecture 13 Pegs - Lecture 13 Pegs 15:01 The firm: a profit...

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