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SHUTDOWN RULE, MONOPOLY: The marginal revenue and marginal cost approach to analyzing a monopoly firm's short-run production decision can be used to identify circumstances in which a firm minimizes losses by shutting down production in the short run. If the market price 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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MONOPOLISTIC COMPETITION, LONG-RUN ADJUSTMENT A monopolistically competitive industry undertakes a two-part adjustment to equilibrium in the long run. One is the adjustment of each monopolistically competitive firm to the appropriate factory size that maximizes long-run profit. The other is the entry of firms into the industry or exit of firms out of the industry, to eliminate economic profit or economic loss. The end result of this long-run adjustment is two equilibrium conditions--one for profit maximization, the other for zero economic profit.
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GRAY SKITTERY
[What's This?]
Today, you are likely to spend a great deal of time wandering around the downtown area hoping to buy either a video camera with stop action features or one of those memory foam pillows. Be on the lookout for broken fingernail clippers.
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On a typical day, the United States Mint produces over $1 million worth of dimes.
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"The greatest barrier to success is the fear of failure." -- Sven Goran Eriksson, writer
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AFEA
American Farm Economic Association
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