ECON 0100 Chapter Notes - Chapter 13: Marginal Product, Production Function, Fixed Cost
Document Summary
Economic profit total revenue minus total costs, including both explicit and implicit costs. Accounting profit total revenue minus total explicit costs. Production function the relationship between quantity of inputs used and the quantity of output of a good. Average total cost total cost divided by the quantity of output: tells us the cost of a typical unit of output if total cost is divided evenly over all the units produced. Average fixed cost fixed cost divided by the quantity of output. Average variable cost variable cost divided by the quantity of output. Marginal cost the change in total cost divided by the change in quantity: tells us the increase in total cost that arises from producing an additional unit of output. Efficient scale the quantity of output that minimizes average total cost.
