Week%206%20Session%202%202009

# Week%206%20Session%202%202009 - Microeconomics 1 Session 2...

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Diane Enahoro Session 2 2009 1 Microeconomics 1 Session 2 2009 Week 6 - Group A and B Efficiency and Exchange Text Ch 7 Outline: The firm’s Shut-down condition Supply Curve (P=MC) Market Equilibrium and Efficiency Taxes and Efficiency

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Diane Enahoro Session 2 2009 2 Output/Week AVC ATC MC Price \$ Output Cost Variable Cost Variable Average = Δ Output Δ TotalCost Cost Marginal = Output Cost Total alCost AverageTot = Significance of the minimum point on the ATC
Diane Enahoro Session 2 2009 3 Output/Week AVC ATC MC Price \$ The Firm’s Supply Curve in the Short-run

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Diane Enahoro Session 2 2009 4 The Profit-maximising rule summarised Produce the level of output for which P = MC, provided that P > AVC If P < AVC at all levels of output, shut down and produce nothing Firm’s SR supply curve is the portion of its MC lies above its AVC curve
Diane Enahoro Session 2 2009 5 Efficiency (Pareto) a situation is efficient if there is no opportunity to act to make one person better off without

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## This note was uploaded on 08/06/2011 for the course FIN 3616 taught by Professor Henry during the Three '11 term at University of New South Wales.

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Week%206%20Session%202%202009 - Microeconomics 1 Session 2...

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