Chapter 23 Terms 102

# Chapter 23 Terms 102 - P roperties of the P roduction...

This preview shows pages 1–2. Sign up to view the full content.

Properties of the Production Function: The production function specifies the maximum possible output that can be produced with a given amount of inputs. It also specifies the minimum amount of inputs necessary to produce a given output. Total Physical Product: Total output. Average physical product: is total product divided by the variable input. Marginal physical product: is the change in total product that occurs when there is a one-unit change in the variable input. Diminishing Marginal Product: The law of diminishing marginal product is the observation that with successive increases in a variable factor of production such as labor, added to fixed factors of production, will reach a point beyond which the extra or marginal product that can be attributed to each additional unit of the variable factor of production will decline. Short-Run versus Long-Run: The short run is a time period when some inputs, such as plant size, cannot be changed. The long-run is a time period in which all

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

## This note was uploaded on 06/06/2011 for the course ECON 102 taught by Professor Dsilvia during the Fall '11 term at Moraine Valley Community College.

### Page1 / 2

Chapter 23 Terms 102 - P roperties of the P roduction...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online