Short-Run Costs 7.3-7 Hunter Parrott Flashcards
1
Q
What is MC?
A
Marginal Cost, the cost of producing an extra unit of output.
2
Q
When MC is below ___, MC pulls the average down.
A
AVC
3
Q
When MC is ______ AVC, MC is pushing the average up;
A
above
4
Q
MC and AVC intersect at the ______ AVC.
A
lowest
5
Q
If you flip the AVC and MC curves over, they become ___ and ___ curves.
A
APL, MP
6
Q
Does AVC and MC curves mirror APL and MP curves?
A
For Sure
7
Q
MP(L)
A
Marginal Product
8
Q
What is MP(L)?
A
Extra output produced with and additional worker hired.
9
Q
AP(L)
A
average product
10
Q
What is AP(L)?
A
Output produced per worker
11
Q
when the next unit costs less than the average, it must be pulling the average ____.
A
down
12
Q
What happens when MC is above AVC?
A
MC pushes average up.
