micro 2

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  • Created by: tkaysav
  • Created on: 06-01-20 22:53
total revenue
all the money recieved by a firm from selling its total output - price x quantity
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average revenue
total revenue / total output
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profit
is the difference between total sales revenue and cost of production
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fixed costs
costs that dont change dependent on output
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variable
costs that change dependent on output
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normal profit
defined as the minimal level of profit necessary to keep a firm in that line of business - AR = ATC
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super normal profit / abnormal profit
extra profit above the level of normal profit - AR > ATC
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subnormal profit
when profit fails to meet the level of normal profit - AR < ATC
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profit maximisation
when a firms total sales revenue is furthest above its total costs of production
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Other cards in this set

Card 2

Front

average revenue

Back

total revenue / total output

Card 3

Front

profit

Back

Preview of the front of card 3

Card 4

Front

fixed costs

Back

Preview of the front of card 4

Card 5

Front

variable

Back

Preview of the front of card 5
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