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SHORT-RUN PRODUCTION ALTERNATIVES: A firm faces three production options in the short run based on a comparison between price, average total cost, and average variable cost. If price is greater than average total cost, a firm earns an economic profit by producing the quantity that equates marginal revenue with marginal cost. If price is less than average total cost but greater than average variable cost, a firm incurs an economic loss, but produces the quantity that equates marginal revenue with marginal cost. If price is less than average variable cost, a firm shuts down production in the short run, incurring an economic loss equal to total fixed cost.
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RECOGNITION LAG The time lag that it takes to identify and document the existence of an economic problem that might require government action. The recognition lag arises because it takes time to collect and analyze economic data; to verify that an actual problem exists. This "inside lag" is one of four policy lags associated with monetary and fiscal policy. The other two "inside lags" are decision lag and implementation lag, and one "outside lag" is implementation lag. All four policy lags can reduce the effectiveness of business-cycle stabilization policies and can even destabilize the economy.
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Approximately three-fourths of the U.S. paper currency in circular contains traces of cocaine.
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"The man who does not read good books has no advantage over the man who cannot read them. " -- Mark Twain
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FASB
Financial Accounting Standards Board
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