(7.3-6; 7.3-7; 7.3-8; 7.3-9; 7.3-10)-A. Smith Flashcards Preview

Econ 2106 Extra Credit #2 > (7.3-6; 7.3-7; 7.3-8; 7.3-9; 7.3-10)-A. Smith > Flashcards

Flashcards in (7.3-6; 7.3-7; 7.3-8; 7.3-9; 7.3-10)-A. Smith Deck (61)
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1

A guide for how much to produce is?

marginal cost

2

The cost of labor per unit of output produced
is ___________.

average cost

3

What does AVC stand for?

average cost variable

4

AVC = ?

VC(total variable cost) / TP (total output)

5

Does marginal cost and average variable cost
the same concept?

no

6

What two things are substantial in finding the
average variable cost?

total variable cost and total output

7

Do we, as economists, multiply or divide
variable cost and total product to get the average variable cost?

divide

8

What is AVC good for?

to see if one would make a profit or not

9

Does AVC vary when we change amount of
output?

yes

10

When does AVC change?

When the productivity changes

11

Productivity and cost are ________ related.

inversely

12

As price increases, cost _________.

decreases

13

Marginals and averages always have the
same relationships. True or False

True

14

When marginal increases, average ________.

increases

15

When marginal decreases, average
__________.

decreases

16

What is the slope of the variable cost curve.

Marginal cost

17

The AVC curve is at a __________ when it intersects with the MC curve.

minimum

18

When MC is above AVC, it pulls the
average ________

up

19

When MC is below AVC, it pulls the average
__________

down

20

Minimum slope = __________ AVC

minimum

21

Marginal cost is _________ related to
marginal product.

inversely

22

AVC is ________ related to average product.

inversely

23

What is the definition of slop?

rise over run

24

the curves of MC and AVC are ________
_______ to the curves of MP and AP.

mirror images

25

What is on the x-axis on the MC and AVC graph?

TP (output)

26

Define Short run:

brief period of time that is so short that at
least one input is fixed

27

Fixed input costs that are constant

fixed cost

28

The more sets you _______, the more thinly
you can spread your fixed costs out

produce

29

The more you produce, the more your fixed
costs _______

shrinks

30

What is AFC?

average fixed cost