Producer theory Flashcards
1
Q
What is the SR?
A
A period in which a firm is unable to change at least one FOP (e.g. could hire extra staff, but couldn’t buy another factory)
2
Q
MPL+ formula?
A
The increase in Q from an additional unit of labour
dQ/dL
3
Q
APL + formula?
A
The ratio of output to no. of labour units employed
q/L
4
Q
Isoquants?
A
They describe the possible combinations of factors (L and K) that when used efficiently, generate a given level of output
5
Q
MRTS
A
-MPL/MPk
