Costs of Production
Seven Types of Costs
But only two: variable and fixed.
But really only two: average and
Total cost: variable + fixed costs.
Variable cost = Px*X.
Fixed cost: constant regardless of
Average variable cost
The Theory of Demand
Graphically demonstrate consumer
Show how price and income changes affect
Derive a consumers demand curve.
Derive a market demand curve.
Differentiate income and substitut
Theory of Production
Why firms do what they do
Describe the conditions necessary for
Describe the types of inputs in a
Describe, graph and compute the
relationships between inputs