ECON 205 Lecture Notes - Lecture 10: Perfect Competition, Marginal Cost
Document Summary
***remember problem sets on course documents and make sure you study for exam next period. Read chapter 8, 10, 11, 12 and study notes, don"t" forget problem sets. Chapter 11: optimal point: mr=mc (doesn"t mean in all situations) If price is lower than average total cost, then you have a profit: (1) many small sellers, (2) homogenous product, (3) free entry and exit. Long run equilibrium: (1) p= mc (price= marginal cost, (2) p= minimum of atc (average total cost, (3) stiff competition. Ix: difference between accounting profit and economic profit.
