| Line 51: |
Line 51: |
| | ===Medium=== | | ===Medium=== |
| | | | |
| | + | *'''Coase theorem''' |
| | *'''consumer surplus''' (savings by consumers who would pay more than the market price for a good) | | *'''consumer surplus''' (savings by consumers who would pay more than the market price for a good) |
| | *'''indifference curve''' | | *'''indifference curve''' |
| Line 60: |
Line 61: |
| | *'''elastic demand''' | | *'''elastic demand''' |
| | *'''inelastic demand''' | | *'''inelastic demand''' |
| | + | *'''minimum wage''' |
| | + | *'''cross-elasticity of demand''' (percent change in demand for good X divided by percent change in price for good Y) |
| | + | *'''income elasticity of demand''' (percent change in demand for good X divided by percent change in income) |
| | *'''price elasticity of demand''' (percent change in quantity demanded divided by percent change in price, dropping the negative sign) | | *'''price elasticity of demand''' (percent change in quantity demanded divided by percent change in price, dropping the negative sign) |
| | *'''price controls (price ceilings and price floors)''' | | *'''price controls (price ceilings and price floors)''' |
| | *'''marginal cost''' (MC = change in total cost (TC) due to producing one more unit of output Q) | | *'''marginal cost''' (MC = change in total cost (TC) due to producing one more unit of output Q) |
| − | *'''total fixed costs''' (TFC) do not change as more is produced, thus MC = change in TVC due to one more output Q) | + | *'''total fixed costs''' (TFC) do not change as more is produced. Because TC=TFC+TVC, and TFC does not change as more Q is produced, the marginal cost (MC) must be equal to the change in TVC due to producing one more output Q |
| | *'''marginal revenue''' (MR) | | *'''marginal revenue''' (MR) |
| − | *alternative definition of the '''“long run”''': enough time to adjust all inputs in order to produce a given Q at the lowest possible cost | + | *a clever definition for the '''“long run”''': enough time to adjust all inputs in order to produce a given Q at the lowest possible cost |
| | *'''variable inputs''' (inputs that are increased to produce more Q in the short run) | | *'''variable inputs''' (inputs that are increased to produce more Q in the short run) |
| | *'''fixed inputs''' (inputs that cannot be increased in the short run to produce more Q) | | *'''fixed inputs''' (inputs that cannot be increased in the short run to produce more Q) |
| Line 85: |
Line 89: |
| | | | |
| | ===Equations of Medium Difficulty=== | | ===Equations of Medium Difficulty=== |
| | + | |
| | + | ("Q" stands for output and "MP" stands for marginal product.) |
| | :At Q = 0, TC = TFC | | :At Q = 0, TC = TFC |
| − | ::When quantity produced is 0, the total costs are total fixed costs. | + | ::When quantity produced is 0, the total costs are the total fixed costs. |
| | :At all Q > 0, AVC = TVC / Q | | :At all Q > 0, AVC = TVC / Q |
| | ::Whenever quantity produced is greater than 0, average variable cost equals total variable cost divided by quantity. | | ::Whenever quantity produced is greater than 0, average variable cost equals total variable cost divided by quantity. |
| Line 109: |
Line 115: |
| | | | |
| | *'''price discrimination''' | | *'''price discrimination''' |
| − | *'''minimum wage''' | + | *'''producer surplus''' |
| − | *'''cross-elasticity of demand''' (percent change in demand for good X divided by percent change in price for good Y)
| |
| − | *'''income elasticity of demand''' (percent change in demand for good X divided by percent change in income)
| |
| | *'''supply elasticity''' | | *'''supply elasticity''' |
| | *'''division of labor''' | | *'''division of labor''' |
| Line 117: |
Line 121: |
| | *'''condition for reducing production''' (MC>MR) | | *'''condition for reducing production''' (MC>MR) |
| | *'''condition for shutting down''' (P<AVC in short run or P<ATC in long run) | | *'''condition for shutting down''' (P<AVC in short run or P<ATC in long run) |
| − | *'''Coase theorem'''
| |
| | *'''Giffen good''' | | *'''Giffen good''' |
| − | *'''mathematical solutions''' and '''specific calculations'''
| |
| | | | |
| | ===Equations of Honors Difficulty=== | | ===Equations of Honors Difficulty=== |