ECON 200 Lecture 17: Econ 200,University of Arizona,Readings-Notes(p17)
azurerhinoceros284 and 2 others unlocked
27
ECON 200 Full Course Notes
Verified Note
27 documents
Document Summary
Industrial organization the study of how firms" decisions about prices and quantities depend on the market conditions they face. A firm"s costs are a key determinant of its production and pricing decisions. Economists normally assume that the goal of a firm is to maximize profit. Total revenue - the amount a firm receives for the sale of its output. Total cost - the market value of the inputs a firm uses in production. Profit is a firm"s total revenue minus its total cost. Total revenue equals the quantity of output the firm produces multiplied by the price at which it sells its output. Cost of production, they include all the opportunity costs of making its output of goods and services. Explicit costs - input costs that require an outlay of money by the firm. Implicit costs - input costs that do not require an outlay of money by the firm.