Econ Test 2 example #74408

4 January 2023
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Fixed Cost is:
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any cost which doesnt not change when the firm changes its output
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The Marginal cost curve for a firm intersects:
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the minimum of the average variable cost and average total cost curves.
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Consumer Surplus is:
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...
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To the economist total cost includes:
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Explicit and implicit costs which includes a normal profit.
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In the Long Run:
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All costs are variable costs.
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For a purely competitive firm, total revenue:
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is the price times the quantity sold.
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Public goods cause a free rider problem because:
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Once a public good has been provided, other consumers cant be excluded form the benefits of the good.
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If a firm decides to shutdown in the short run and produce no output, its costs will be:
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It's fixed costs.
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The formula for calculating marginal cost is:
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The change in total cost (TC) over the change in total output when the change in output is equal to 1.
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Market Failure is:
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The inability of some unregulated markets to allocate resources efficiently.
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Marginal Cost is:
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The change in total cost that results from producing one more unit of output.
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To the economist total cost includes:
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Explicit and implicit costs which includes a normal profit.
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Consumer Surplus is:
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The difference between what consumers are willing to pay for a good or service and what they actually pay (the market price).
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An example of a Public good is:
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National defense.
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Marginal Revenue for a firm is:
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The increase in total revenue when it sells one additional unit of output.
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Diminishing marginal utility means that:
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as more and more of a good is consumed the rate at which total utility increases starts to diminish.
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Profit max:
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@ Q where MR=MC
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A Cartel:
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A group of producers who act in concert in order to make monopoly.