M2

24問 • 1年前

問題一覧

- concerned with the behavior and activities of specific economic units (individuals, households, firms, industries, markets, consumers, producers).

Microeconomics

The process of transforming both fixed and variable inputs into finished goods and services

theory of production

- refers to a single production activity; example: a farmer simultaneously produces rice and mungbean; therefore, s/he is involved in two different enterprises

Enterprise

- the technical relationship between the quantity of inputs used to produce a good and the quantity of output of that good; can be represented by a table, equation, or graph - q= f(K,L,N,etc) where: q=output; K,L,N= inputs

Production Function

- entity concerned with the employment of resources in the production of goods/services

Firm

– factors of production

Inputs

Tyoes of input

fixed, variable

- inputs whose use rate does not change as the output level changes; Example: land

Fixed

- inputs whose use rate changes as the output level changes; Example: labor, seeds, fertilizer

Variable

– goods and services produced using the inputs

Outputs

– total amount of output produced in physical units

Total Product (TP or Q)

– the rate of change in output as an input is changed by one unit, holding all other inputs constant; MPI = ΔQI / ΔI where I is any variable input

Marginal Product (MP)

- states that when successive units of a variable input work with a fixed input, beyond a certain point the additional product produced by each additional unit of a variable input, decreases

Law of Diminishing Returns

returns states that "as the use of an input increases (with other inputs fixed), a point will eventually be reached at which the resulting additions to output decrease"

law of diminishing

- measures the total output per unit of input used;

Average Product (AP)

Length of run

Long run, Short run, Very short run

– all inputs to the production function can be treated as variable; management must evaluate investment alternatives such as whether the firm should purchase more land or equipment

Long Run

– period of time is short enough that some inputs can be treated as fixed; management must evaluate which variable resources should be combined with the fixed resources in order to maximize the profits of the enterprise

Short Run

– so short that none of the inputs are variable

Very Short Run

- as all inputs are increased by a given proportion, output increases by the same proportion; large firms are equally efficient and could be expected to happily coexist

Constant Returns to Scale

the quantitative change in output of a firm or industry resulting from a proportionate increase in all inputs

returns to scale

- as all inputs are increased by a given proportion, output increases by a greater proportion; expect to see larger firms driving the smaller ones out of business since the larger firms could produce more output per bundle of inputs than the smaller firms

Increasing Returns to Scale

- as all inputs are increased by a given proportion, output increases by a lesser proportion

Decreasing Returns to Scale

the difference between total revenue and total cost

profit

Soil Tech Midterm 1

Mutated Lemon · 100問 · 2年前

Soil Tech Midterm 1