ECON 1201 Lecture 17: Micro Economics Chapter 11: Part 1

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ECON 1201 Lecture Notes - Lecture 15: Normal Distribution, Marginal Revenue, Behavioral Economics

ECON 1201 Lecture 17: Micro Economics Chapter 11: Part 1

ECON 1201 Lecture Notes - Lecture 18: Average Variable Cost, Marginal Cost, Diminishing Returns

Document Summary

Production is the process of turning inputs into outputs. The cost of structure if a firm depends on the nature of the production process. Marginal product is the change in output resulting from a one-unit increase in the amount of labor input ( (cid:3028)(cid:3041) (cid:3041) (cid:3044)(cid:3048)(cid:3028)(cid:3041)(cid:3047)(cid:3047) (cid:3028)(cid:3041) (cid:3041) (cid:3028)(cid:3029)(cid:3042)(cid:3045) ) product will be lower than the last worker"s. Marginal product initially rises as more workers are hired; then it declines. Past a certain point, another field worker will be so crowded that his marginal. A production function is the relationship between the quality of inputs a firm uses and the quantity of output it produces. A fixed input is an input whose quantity is fixed for a period and cannot be varied. A variable input is an input whose quantity the firm can vary at any time. The long run is the period in which all inputs can be varied.

Related Questions

If Microsoft is determining whether to build a new plant in southern California or in New Mexico, it is making a(n)_______decision.

a. variable-input
b.long-run
c.short-run
d.immediate-run

Every point on the long-run average cost curve is

a. on a short-run average total cost curve
b.also a minimum point on a short-run average cost curve
c.on a short-run marginal cost curve
d.on a short-run average variable cost curve

For a perfect competitor, marginal revenue equals
a.price divided by average revenue
b.the market price
c.the slope of the demand curve
d.average revenue divided by price

The law of diminishing marginal product shows the relationship

a.between inputs and outputs for a firm in the short-run
b.between accounting and economic profits
c.between short-run and long-run outputs of a firm
d.between inputs and outputs for a firm in the long run

coralmule144

Complete the table directly below by calculating marginal product and average product. Explain why marginal product first rises, then declines, and ultimately becomes negative. What bearing does the law of diminishing returns have on short-run costs? Be specific.

Inputs of labor Total product Marginal product Average product

0 0

1 13

2 34

3 51

4 65

5 74

6 80

7 83

8 79

harlequintrout814

The firms in a perfectly competitive industry had been earning zero economic profits. However, the firms have recently experienced a large decrease in the cost of energy that enables them to substantially reduce the marginal cost and average total cost of producing each unit of output. The market demand for the product is pretty elastic. On the other hand, short-run efforts to increase production run into severely diminishing returns concerning the employment of additional variable inputs. Why?

salmontiger441

ECON 1201 Lecture 17: Micro Economics Chapter 11: Part 1

ECON 1201 Lecture Notes - Lecture 15: Normal Distribution, Marginal Revenue, Behavioral Economics

ECON 1201 Lecture 17: Micro Economics Chapter 11: Part 1

ECON 1201 Lecture Notes - Lecture 18: Average Variable Cost, Marginal Cost, Diminishing Returns

Document Summary

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