Chapter 5 Flashcards
(23 cards)
Supply curve
Graph from supply schedule
Supply schedule
List/table of how much an individual is willing to offer
Law of supply
When prices go down quantity supplied goes down; when prices go up the quantity supplied goes up
Marginal products
Change in total output brought about adding one more worker
Specialization
Having a worker focus on a particular aspect of production
Diminishing returns
When hiring new workers causes marginal product to decrease
Increasing returns
When hiring new workers cause marginal product to increase
Fixed cost
Stays the same regardless of what is going on
Marginal cost
Extra cost of producing one more unit
Total cost
Sum of fixed cost and variable cost
Variable cost
Changes with what is happening at work
Marginal revenue
Money made from the sale of each additional unit of output
Total revenue
Company’s income from selling its products
Profit maximizing output
Level of production at which a business realized the greatest amount of profit
Change in quantity supplied
Rise or fall in the amount producers offer for sale because of a change in price
Change in supply
Another word for shift in supply
Occurs when a change in the marketplace prompts producers to sell different amounts at every price
Elasticity of supply
Measure of how responsive producers are to price changes in the marketplace
Excise tax
Taxes on certain goods and services
Input costs
Price of the resources used to make products
Labor productivity
Amount of goods and services that a person can produce in a given time
Regulation
Set of rules or laws designed to control business behavior
Technology
Entails applying scientific methods and innovations to production
Supply
Willingness and ability of producers to offer goods and services for sale
