ECO204Y1 Study Guide - Midterm Guide: Economic Surplus, Vertical Integration, Market Price

• School: UTSG
• Department: Economics
• Course: ECO204Y1
• Professor: Karen Bernhardt- Walther

Document Summary

Mrtslk = mpl / mpk ------------------------------------ rtslk = -(dk/dl) P x mpk = mck ---------------------------------- mpk/mpl = pk/pl. The marginal revenue product of labor is the change in revenue that results from employing an additional unit of labor (or capital, in the long run) mpl * Marginal productivity: mp(k) = df(k,l)/dl --------------------------- diminishing marginal productivity: dmp(k)/dk = d2f(k,l)/dk2. Dual problem: min(k,l) tc(k,l) such that f(k,l) >= q0 -------------------------- max(k,l) f(k,l) such that tc(k,l) <= c0. If part of a purchase can be sold, it is an avoidable cost. Change in production technology (change in isoquant --------------------------------------- change in input prices (change in isocost) Supply curve exists where mc>ac (avc in the sr) If p