ECON 201 Lecture Notes - Lecture 16: Average Cost, Average Variable Cost, Marginal Cost

• School: Concordia University
• Department: Economics
• Course: ECON 201
• Professor: Ivan Tchinkov

Document Summary

Econ 201 lecture 16 (chapter 8) production and costs (monday 29/10 week 9) Time frame: not defined by time but by whether production is flexible or not: short run: not flexible/cannot find more resources given such short time. At least 1 fator of production is fixed (usually capital) and labour variable: long run: all factors can be adjusted through time, very long run: technology development => new tech is brought into use. Production in short-run: total product (tp): a function of l (labour) with k (capital) a constant. Q= f(l: marginal product (mp): addition to output by adding 1 more worker (labour) Mp = q / l: average product (ap): *example 1: you are a student and your output is your gpa each course, input is your own effort. If you get 100% on econ 201 then your mp will rise, thus ap (average gpa whole semester) rises.