Short-Run Costs 7.3-6 Hunter Parrott Flashcards Preview

Econ 2106 Exam 2 > Short-Run Costs 7.3-6 Hunter Parrott > Flashcards

Flashcards in Short-Run Costs 7.3-6 Hunter Parrott Deck (12):
1

Average Variable Cost

variable cost per unit of total product.

2

AVC calculation

divide variable cost at a given total product level by that total product

3

Does AVC determine if the output level is potentially profitable.

YES

4

Variable Cost

the wage cost required to prodice a given level of output, or the wages paid times the number of workers at each output level.

5

If total production is 10, and Variable cost is $2000, what is the AVC?

$200

6

AVC is a guide to show the firm whether a certain output level is ______

profitable

7

If the AVC is greater than the price of the product, would there be potential profit?

No Shot

8

if AVC is lower than the price, could the firm make a profit?

Yes

9

You can sell a TV at $150. If your' TP was 48 and your' VC was $6000, could it be profitable?

Yes

10

You can sell a TV for $150. If your' TP was 48 and your" VC was $8000, could it be profitable?

No

11

What tells the firm if the output level is potentially profitable?

AVC

12

What is the AVC?
TP=42 VC=2,226

AVC= 53