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SHUTDOWN RULE: A rule stating that firm minimizes economic loss by producing no output in the short run if price is less than average variable cost. In the short run, a firm incurs total fixed cost whether or not it produces any output. As such, if the market price is falls below average total cost, it must decide if the economic loss from producing the quantity of output that equates marginal revenue and marginal cost is more or less than the economic loss incurred with shutting down production in the short run (which is equal to total fixed cost).
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STABLE EQUILIBRIUM Equilibrium that is restored if disrupted by an external force. Most economic models have equilibrium that is stable, reflecting the observation that the real world adapts to changes and maintains a fair degree of stability. The alternative to a stable equilibrium is an unstable equilibrium.
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BLACK DISMALAPOD
[What's This?]
Today, you are likely to spend a great deal of time at a crowded estate auction seeking to buy either a coffee table shaped like the state of Florida or storage boxes for your summer clothes. Be on the lookout for defective microphones.
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This isn't me! What am I?
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The wealthy industrialist, Andrew Carnegie, was once removed from a London tram because he lacked the money needed for the fare.
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"Motivation is everything. You can do the work of two people, but you can't be two people. Instead, you have to inspire the next guy down the line and get him to inspire his people." -- Lee Iacocca, Chrysler chairman
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FSL
Federal Savings and Loan Association
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