In the unit on supply

In the unit on - Intheunitonsupply,,orthe .Roughlyspeaking,thismeans ,,butthereismoreto .Forin

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In the unit on supply, we established that sellers derive their utility from profits, or the  amount of money that they actually make from a sale. Roughly speaking, this means  that when the price of a good goes up, the seller will be happier, but there is more to  profit than the sale price of a good. For instance, we would think that Kenny, who sells  shirts, would be happier if the selling price went from $20 a shirt to $25 a shirt. If nothing  else changes, then that's true: he will be happier at the higher price. If with the higher  sale price his costs change, however, from an initial cost of $10 a shirt to a cost of $17 a  shirt, then he would have been happier at the lower price, since his profits now are  actually decreased.  Profit = Total Revenue (TR) - Total Cost (TC)  Kenny's initial profit per shirt is:  Profit = 20 - 10 = $10 a shirt 
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This note was uploaded on 12/13/2011 for the course ECO 1320 taught by Professor Staff during the Fall '11 term at Texas State.

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In the unit on - Intheunitonsupply,,orthe .Roughlyspeaking,thismeans ,,butthereismoreto .Forin

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