7.1-1 ; 7.2-1 ; 7.2-2 ; 7,2-3 ; 7,2-4 (Profit/Costs/Production) -K.Cappo Flashcards Preview

Econ 2106 Extra Credit #2 > 7.1-1 ; 7.2-1 ; 7.2-2 ; 7,2-3 ; 7,2-4 (Profit/Costs/Production) -K.Cappo > Flashcards

Flashcards in 7.1-1 ; 7.2-1 ; 7.2-2 ; 7,2-3 ; 7,2-4 (Profit/Costs/Production) -K.Cappo Deck (64)
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1

The difference between the revenue a firm earns and the sum of the opportunity costs of all the resources employed at that firm defines __.

Economic Profit

2

As long as revenue is __ than the sum of opportunity costs, business owners can afford to pay all of the employees a salary that is better than their next best opportunity.

Greater

3

If total revenue is less than the sum of opportunity costs of resources....

Resources will seek employment elsewhere

4

The difference between a firm's total revenue and the explicit expenses that it must pay out defines __.

Accounting Profit Calculated

5

Accounting costs are only __ costs that the firm has to write checks to pay.

Explicit

6

The opportunity costs of the Employees, Managers, and Shareholders (are/aren't) accounted for in accounting costs.

Aren't

7

What is the opportunity cost(s) of the managers, employees, and shareholders?

The most money that they could earn elsewhere.

8

Economic rent is...

The amount of payment an economic resource receives in excess of of its next best alternative.

9

Economic profit is a notion that determines...

Whether or not a firm is doing well enough to stick around.

10

What is the difference between economic reasoning and accounting reckonings is __.

Sunk Costs

11

A Sunk Cost is defined as...

An unrecoverable cost incurred in a previous time period that has no relevance for any current decisions.

12

If benefits are __ the required additional costs to finish a project, then finish it.

Greater than

13

If benefits are less than the required additional costs to finish a project, then __ the project.

Terminate

14

Do not let __ costs make you do unprofitable things.

Sunk

15

T or F: Monetary payment must be made before cost is incurred.

False

16

Businesses ask the question "How much should I produce?" to ensure that....

They will make the most profit

17

A firm's given inputs allows it to make certain __.

Outputs

18

What three things do we need to know about a firm to determine its profit?

Technology, Costs, Prices

19

How much output a firm can produce with a given amount of input is mainly determined by __.

Technology

20

The amount of output a firm can produce with a given amount of input defines __.

Total Output

21

The Short Run is...

A brief period of time during which you can change only one (or a few) of your inputs.

22

While some inputs are fixed, others are __.

Variable

23

The total amount of output that a given amount of labor can produce, holding constant technology and holding constant the quantity of all other inputs that the firm used is...

Total output of variable input labor

24

The total output schedule shows....

The total amount of output you can produce with given amounts of variable input labor, holding constant technological know how and the amount of all other inputs used.

25

T or F: In the short run, all inputs are variable.

False

26

A productions possibility chart shows

Total output

27

T or F: Given the firm's technology and the firm's cost to produce output, economists are able to predict a firm's profit.

False

28

Factor space, number of conveyor belts, tools, and raw materials are all __.

Fixed

29

Total Output is

The amount of output a firm can produce with a given amount of labor (holding constant technology and other inputs).

30

The total product schedule can be represented on a graph by a __.

Total Product Curve