34753623
Descrição
FlashCards por Ryan Finch, atualizado more than 1 year ago
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Criado por Ryan Finch
aproximadamente 3 anos atrás
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| Questão | Responda |
| What is AR, TR and MR? | Total Revenue (TR) – Price of goods multiplied by quantity sold. Average Revenue (AR) – Revenue received per unit at that output – Total revenue divided by output. Marginal revenue (MR) – Addition to Total revenue from one additional sale – change in Total revenue divided by change in quantity. |
| All firms aim for... | Total profit = total revenue - total cost |
| What are the 4 factors of production? | Land = Rent Labour = Wages Capital = Interest Enterprise = Normal profit |
| What are Fixed Costs? | Costs that are independent of output produced e.g. Rent, insurance. |
| What are Variable Costs? | Costs that are directly related to the level of output produced e.g. Raw materials, wages. |
| What is Total Costs? | The total cost of production = variable cost + fixed cost. |
| What is the Profit Maximizing Rule? | The profit maximising rule (MR= MC) This means that a firm's profits are greatest when the addition to sales revenue received from the last unit sold (marginal revenue) equals exactly the addition to total cost incurred from the production of the last unit of output (marginal cost). |
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