ECON 2G03 Lecture Notes - Lecture 5: Opportunity Cost, Exogeny, Economic Surplus

75 views23 pages

Document Summary

Positive profit is a signal that induces entry, or allocation of additional resources to the industry. Losses are a signal that induces exit, or the allocation of fewer resources to the industry. equilibrium: total revenue equals total cost (zero profit) In long-run equilibrium, price equals the minimum average cost which is the efficient scale of production. Long run competitive equilibrium graphs for industry and firm. Occurs at the intersection of lrs and the demand function: lrs incorporates changes in input prices that arise as industry output expands, these changes determine whether the industry is a constant, increasing, or decreasing cost industry. As demans increases, price remains constant and only quantity increases y1 y2. Understand the wide applicability of the competitive model. Apply the basic framework of the competitive market model to a wide array of real-world situations. The supply and demand model (for a good y)

Get access

Grade+20% off
$8 USD/m$10 USD/m
Billed $96 USD annually
Grade+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers
Class+
$8 USD/m
Billed $96 USD annually
Class+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
30 Verified Answers

Related Documents

Related Questions