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					College Prep
 Economics
  Chapter 5 Cornell Notes
        By JR Wiemann
Chapter 5 Quiz Vocabulary
   Chapter 5 Vocabulary Quiz (20 terms)

   Law of Supply    short run
   overhead         market supply curve
   Law of Variable Proportions
   change in supply
   total cost       supply elasticity
   marginal cost    total product
   supply           fixed cost
   supply curve     variable cost
   total revenue    quantity supplied
   raw materials    break-even point
   subsidy          long run
Law of Supply:
(Change in the Quantity Supplied)
Change in Supply:
(non-price reasons)
Determinants of Supply
(factors that can change the supply curve)
Elasticity of Supply: Time
(elastic, inelastic, unit elastic)
Coefficient Test for Supply
Elasticity
Theory of Production
The Law of Variable Proportions
(diminishing marginal returns)
   Stage 1 (increasing returns)
   Stage 2 (diminishing returns)
   Stage 3 (negative returns)
   Marginal Product:
       change in total product/ change in
        input
Fixed Cost & Variable Cost

   Fixed Cost (overhead)
     Salaries
     Interest changed on loans &
      bonds
     Rent payments

     Taxes

     Depreciation
Fixed Cost & Variable Cost
(continued)
   Variable Cost (cost that change
    with doing business)
     Labor
     Raw materials

     Transportation

     Utilities
         Electricity
         Water (etc)
Total Costs & Profit
Profit Maximization

   Marginal Cost:
       Change in total cost/ change in
        output
   Marginal Revenue:
       Change in total revenue/ change
        in output
   Profit Max (point of production)
       P- Max (MC = MR)

				
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posted:10/11/2011
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