The Firm Lecture 12

The Firm Lecture 12 - The Firm 15:05 In econ, the firm, is...

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The Firm 15:05 In econ, the firm,  is a bundle of contracts Is a profit maximizing organization Has a principal agent problem The firm combines inputs Land – natural  Labor – human Capital – machines  Entrepreneurial skill The produce output based on  Input codes Revenue from sales Cost of a college education Not the tuition Opportunity forgone of income you can have while in college Cost and the benefits In 1980 college grad earned 35% more than hs graduate In 2003 college grad earning 73% more than hs graduate Rate of return  is 10-17% per year. – rate of return on your investment Stock market Rate of return6%
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Non-pecuniary benefits Things you’ll enjoy being at uva Not requiring payment of money Enjoy as a consumption goods Cavalier computer chips faces these data points on its supply curve p -90 q- 
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The Firm Lecture 12 - The Firm 15:05 In econ, the firm, is...

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