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SHORT-RUN PRODUCTION: An analysis of the production decision made by a firm in the short run, with the ultimate goal of explaining the law of supply and the upward-sloping supply curve. The central feature of this short-run analysis is the law of diminishing marginal returns, which results in the short run when larger amounts of a variable input, like labor, are added to a fixed input, like capital. This analysis of short-run production is but the first step in a brisk walk toward a better understanding of supply. Further steps include the cost of short-run production, especially marginal cost, and the market structure in which a firm operates, such as perfect competition or monopoly.
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LONG-RUN MARGINAL COST The change in the long-run total cost of producing a good or service resulting from a change in the quantity of output produced. Like all marginals, long-run marginal cost is an increment of the corresponding total. It is the change in long-run total cost divided by, or resulting from, a change in quantity. Long-run marginal cost is guided by returns to scale rather than marginal returns.
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PURPLE SMARPHIN
[What's This?]
Today, you are likely to spend a great deal of time strolling through a department store looking to buy either a battery-powered, rechargeable vacuum cleaner or a remote controlled World War I bi-plane. Be on the lookout for empty parking spaces that appear to be near the entrance to a store.
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John Maynard Keynes was born the same year Karl Marx died.
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"The purpose of learning is growth, and our minds, unlike our bodies, can continue growing as long as we live." -- Mortimer Adler
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IS-LM
Investment/Saving-Liquidity/Money
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