Short run. Long run

Question 1

Cost of production

Answer 1

sum of payments for all factors used to produce a good

Question 2

Short run

Answer 2

a period of time where factors are variable and some are fixed .variable factors can be changed.

Question 3

Long run

Answer 3

A period of time where all factors are variable,all factors can be changed

Question 4

Fixed costs

Answer 4

are payments for the fixed factors.in the short run since all factors are fixed ,total cost are also fixed .

Question 5

variable costs

Answer 5

are payments to variable factors ,in short run variable factors will change with output levels and so will variable costs

Question 6

Total fixed and total variable costs

Answer 6

added together make up total costs

Question 7

Marginal cost

Answer 7

is the addition to total cost from the production of an additional unit of output

Question 8

Average cost

Answer 8

is the cost per unit of output