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ACCOUNTING COST: The actual outlays or expenses incurred in production that shows up a firm's accounting statements or records. Accounting costs, while very important to accountants, company CEOs, shareholders, and the Internal Revenue Service, is only minimally important to economists. The reason is that economists are primarily interested in economic cost (also called opportunity cost). That fact is that accounting costs and economic costs aren't always the same. An opportunity or economic cost is the value of foregone production. Some economic costs, actually a lot of economic opportunity costs, never show up as accounting costs. Moreover, some accounting costs, while legal, bonified payments by a firm, are not associated with any sort of opportunity cost.
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TOTAL FACTOR COST, MONOPSONY The opportunity cost incurred by a monopsony when using a given factor of production to produce a good or service. This is the total cost associated with the use of a particular resource or factor of production--it is the total cost of the factor. For monopsony, the price paid increases with the quantity purchased and total factor cost increases at an increasing rate. Total factor cost is predominately used in the analysis of the factor market. Two derivative factor cost measures are average factor cost and marginal factor cost.
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Today, you are likely to spend a great deal of time touring the new suburban shopping complex wanting to buy either a set of hubcaps or handcrafted decorations to hang on your walls. Be on the lookout for vindictive digital clocks with revenge on their minds.
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The portrait on the quarter is a more accurate likeness of George Washington than that on the dollar bill.
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"The only thing that will stop you from fulfilling your dreams is you. " -- Tom Bradley, former Los Angeles mayor
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