ECON 1B03 Chapter Notes - Chapter 7: Taipei Metro, Fixed Cost, Physical Capital
Shanghaibalcony1234 and 37744 others unlocked
46
ECON 1B03 Full Course Notes
Verified Note
46 documents
Document Summary
The amount a firm receives for the sale of its output. The market value of the inputs a firm uses in production. Includes explicit and implicit costs (money you get receipt for and money you don"t get receipt for. Economic profits: tr - tc, total costs including both implicit and explicit costs. Economic losses: when tr > tc, there is profit. When it"s the other way around, it"s a loss. Thus, economic profit is smaller than accounting profit. Zero economic profit, but there"s still normal profit. Shows relationship between quantity of inputs used to make a good and the quantity of output of that good. How many resources i use and how much i produce. Fixed inputs - cannot vary in quantity for some time (ex. Short run, sr = the period of time in which at least one input into production is fixed. Long run, lr = the period of time in which all inputs into production can vary.