Chapter 3 Flashcards
The quantity you sell at each price is:
Individual Supply
What is the law of supply
The higher the price, the more you sell of it
When all businesses in the industry sell identical goods, this is called (gas stations).
Perfect competition
When it is a perfect market, the best strategy is to price your products way higher than the rest (true or false)
False
When managers price their products the same as the industry average, they are called
Price takers
Do marginal costs include fixed costs?
No
The price of the land, or the price of a new CEO is an example of
Fixed costs
The overtime wage of workers, and the price of extra goods are an example of
Marginal costs
The individual supply curve, is also
Marginal cost curve
The additional output you get from each unit of input
Marginal product
Diminishing marginal products is the cause for upward slope (True/ False)
True
More efficient work strategy can cause for rightward shift in supply (true or false)
True
List the 5 factors affecting supply curve: TIPBE
1) Input Prices
2) Business Productivity and Tech
3) Prices of related outputs (Substitutes in production/ complements in production)
4) Expectations
5) Type and number of sellers * only affects market supply curve
Shell decides to sell more of diesel because it is priced higher than gas, this is called:
Substitute in production
If cutting grass gives me more products for mulch, then this is called
Complements in production
