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Long-run Cost Curve
{{more references, date=September 2010 In economics, a cost function represents the minimum cost of producing a quantity of some good. The long-run cost curve is a cost function that models this minimum cost over time, meaning inputs are not fixed. Using the long-run cost curve, firms can scale their means of production to reduce the costs of producing the good.Fuss M.A. (1987) Production and Cost Functions. In: Palgrave Macmillan (eds) The New Palgrave Dictionary of Economics. Palgrave Macmillan, London There are three principal cost functions (or 'curves') used in microeconomic analysis: * Long-run total cost (LRTC) is the cost function that represents the total cost of production for all goods produced. * Long-run average cost (LRAC) is the cost function that represents the average cost per unit of producing some good. * Long-run marginal cost (LRMC) is the cost function that represents the cost of producing one more unit of some good. The idealized "long run" for a firm ref ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economics
Economics () is the social science that studies the production, distribution, and consumption of goods and services. Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics analyzes what's viewed as basic elements in the economy, including individual agents and markets, their interactions, and the outcomes of interactions. Individual agents may include, for example, households, firms, buyers, and sellers. Macroeconomics analyzes the economy as a system where production, consumption, saving, and investment interact, and factors affecting it: employment of the resources of labour, capital, and land, currency inflation, economic growth, and public policies that have impact on these elements. Other broad distinctions within economics include those between positive economics, describing "what is", and normative economics, advocating "what ought to be"; between economic theory and applied economics; between rational a ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Micro-enterprise
A micro-enterprise (or microenterprise) is generally defined as a small business employing nine people or fewer, and having a balance sheet or turnover less than a certain amount (e.g. €2 million or PhP 3 million). The terms microenterprise and microbusiness have the same meaning, though traditionally when referring to a small business financed by microcredit the term microenterprise is often used. Similarly, when referring to a small, usually legal business that is not financed by microcredit, the term microbusiness (or micro-business) is often used. Internationally, most microenterprises are family businesses employing one or two persons. Most microenterprise owners are primarily interested in earning a living to support themselves and their families. They only grow the business when something in their lives changes and they need to generate a larger income. According to information found on the Census.gov website, microenterprises make up 95% of the 28 million US companies tr ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Socially Optimal Firm Size
{{unreferenced, date=August 2013 The socially optimal firm size is the size for a company in a given industry at a given time which results in the lowest production costs per unit of output. Discussion If only diseconomies of scale existed, then the long-run average cost-minimizing firm size would be one worker, producing the minimal possible level of output. However, economies of scale also apply, which state that large firms can have lower per-unit costs due to buying at bulk discounts (components, insurance, real estate, advertising, etc.) and can also limit competition by buying out competitors, setting proprietary industry standards (like Microsoft Windows), etc. If only these "economies of scale" applied, then the ideal firm size would be infinitely large. However, since both apply, the firm must not be too small or too large, to minimize unit costs. Variation in optimal firm size by industry The "diseconomies of scale" do not tend to vary widely by industry, but "ec ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Differentiable Function
In mathematics, a differentiable function of one real variable is a function whose derivative exists at each point in its domain. In other words, the graph of a differentiable function has a non-vertical tangent line at each interior point in its domain. A differentiable function is smooth (the function is locally well approximated as a linear function at each interior point) and does not contain any break, angle, or cusp. If is an interior point in the domain of a function , then is said to be ''differentiable at'' if the derivative f'(x_0) exists. In other words, the graph of has a non-vertical tangent line at the point . is said to be differentiable on if it is differentiable at every point of . is said to be ''continuously differentiable'' if its derivative is also a continuous function over the domain of the function f. Generally speaking, is said to be of class if its first k derivatives f^(x), f^(x), \ldots, f^(x) exist and are continuous over the domain of the fu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Curvature
In mathematics, curvature is any of several strongly related concepts in geometry. Intuitively, the curvature is the amount by which a curve deviates from being a straight line, or a surface deviates from being a plane. For curves, the canonical example is that of a circle, which has a curvature equal to the reciprocal of its radius. Smaller circles bend more sharply, and hence have higher curvature. The curvature ''at a point'' of a differentiable curve is the curvature of its osculating circle, that is the circle that best approximates the curve near this point. The curvature of a straight line is zero. In contrast to the tangent, which is a vector quantity, the curvature at a point is typically a scalar quantity, that is, it is expressed by a single real number. For surfaces (and, more generally for higher-dimensional manifolds), that are embedded in a Euclidean space, the concept of curvature is more complex, as it depends on the choice of a direction on the surfa ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Function (mathematics)
In mathematics, a function from a set to a set assigns to each element of exactly one element of .; the words map, mapping, transformation, correspondence, and operator are often used synonymously. The set is called the domain of the function and the set is called the codomain of the function.Codomain ''Encyclopedia of Mathematics'Codomain. ''Encyclopedia of Mathematics''/ref> The earliest known approach to the notion of function can be traced back to works of Persian mathematicians Al-Biruni and Sharaf al-Din al-Tusi. Functions were originally the idealization of how a varying quantity depends on another quantity. For example, the position of a planet is a ''function'' of time. Historically, the concept was elaborated with the infinitesimal calculus at the end of the 17th century, and, until the 19th century, the functions that were considered were differentiable (that is, they had a high degree of regularity). The concept of a function was formalized at the end of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Graph Of A Function
In mathematics, the graph of a function f is the set of ordered pairs (x, y), where f(x) = y. In the common case where x and f(x) are real numbers, these pairs are Cartesian coordinates of points in two-dimensional space and thus form a subset of this plane. In the case of functions of two variables, that is functions whose domain consists of pairs (x, y), the graph usually refers to the set of ordered triples (x, y, z) where f(x,y) = z, instead of the pairs ((x, y), z) as in the definition above. This set is a subset of three-dimensional space; for a continuous real-valued function of two real variables, it is a surface. In science, engineering, technology, finance, and other areas, graphs are tools used for many purposes. In the simplest case one variable is plotted as a function of another, typically using rectangular axes; see '' Plot (graphics)'' for details. A graph of a function is a special case of a relation. In the modern foundations of mathematics, and, ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Ceteris Paribus
' (also spelled '; () is a Latin phrase, meaning "other things equal"; some other English translations of the phrase are "all other things being equal", "other things held constant", "all else unchanged", and "all else being equal". A statement about a causal, empirical, or logical relation between two states of affairs is ''ceteris paribus'' if it is acknowledged that the statement, although usually accurate in expected conditions, can fail because of, or the relation can be abolished by, intervening factors. chapter 2 A ''ceteris paribus'' assumption is often key to scientific inquiry, because scientists seek to eliminate factors that perturb a relation of interest. Thus epidemiologists, for example, may seek to control independent variables as factors that may influence dependent variables—the outcomes of interest. Likewise, in scientific modeling, simplifying assumptions permit illustration of concepts considered relevant to the inquiry. An example in economics is " ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
X-efficiency
X-inefficiency is the divergence of a firm’s observed behavior in practice, influenced by a lack of competitive pressure, from efficient behavior assumed or implied by economic theory. The concept of X-inefficiency was introduced by Harvey Leibenstein. X-Inefficiency is introduced in 1966 by the professor of Harvard University, Harvey Leibenstein's publication in the '' American Economic Review,'' named "Allocative efficiency vs. X efficiency". X-Inefficiency refer to the firm's production that fails to make full use of its resources, resulting reaches to the maximum possible level of output given the existing resources and environment, namely the efficiency frontier. X-inefficiency pin out irrational actions performed by firms in the market. Overview The difference between the actual and minimum cost of production for a given output produces X-inefficiency. Companies will incur X-Inefficiency as a result of lack of motivation to control its costs, which brings the average cost ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Cost Curve
In economics, a cost curve is a graph of the costs of production as a function of total quantity produced. In a free market economy, productively efficient firms optimize their production process by minimizing cost consistent with each possible level of production, and the result is a cost curve. Profit-maximizing firms use cost curves to decide output quantities. There are various types of cost curves, all related to each other, including total and average cost curves; marginal ("for each additional unit") cost curves, which are equal to the differential of the total cost curves; and variable cost curves. Some are applicable to the short run, others to the long run. Notation There are standard acronyms for each cost concept, expressed in terms of the following descriptors: *SR = short-run (when the amount of physical capital cannot be adjusted) *LR = long-run (when all input amounts can be adjusted) *A = average (per unit of output) *M = marginal (for an additional unit of o ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Information Set (game Theory)
In game theory, an information set is a set that, for a particular player, given what that player has observed shows the decision vertices available to the player which are undistinguishable to them at the current point in the game. For a better idea on decision vertices, refer to Figure 1. If the game has perfect information, every information set contains only one member, namely the point actually reached at that stage of the game, since each player knows the exact mix of chance moves and player strategies up to the current point in the game. Otherwise, it is the case that some players cannot be sure exactly what has taken place so far in the game and what their position is. Information sets are used in extensive form games and are often depicted in game trees. Game trees show the path from the start of a game and the subsequent paths that can be made depending on each player's next move. Information sets can be easily depicted in game trees to display each player's possible mov ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Production Technology
Production may refer to: Economics and business * Production (economics) * Production, the act of manufacturing goods * Production, in the outline of industrial organization, the act of making products (goods and services) * Production as a statistic, gross domestic product * Production line Arts, entertainment, and media Motion pictures * Production, film distributor of a company * Production, phase of filmmaking * Production, video production Other uses in arts, entertainment, and media * ''Production'' (album), by Mirwais, 2000 * Production, category of illusory magic trick * Production, phase of video games development * Production, Record producer's role * Production, theatrical performance Science and technology * Production, deployment environment where changes go "live" and users interact with it * Production (computer science), formal-grammar concept * Primary production, the production of new biomass by autotrophs in ecosystems * Productivity (ecology), the wider ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
