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LONG-RUN TOTAL COST: The opportunity cost incurred by all of the factors of production used in the long run (when all inputs are variable) by a firm to produce of a good or service, including wages paid to labor, rent paid for the land, interest paid to capital owners, and a normal profit paid to entrepreneurs. Unlike short-run total cost, long-run total cost can not be separated into fixed cost and variable cost. In the long run, all inputs are variable, so all cost is variable.
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Lesson 13: The Firm | Unit 1: Introduction
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Page: 3 of 24
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Topic:
Entrepreneurship
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- The official definition for entrepreneurship:
- Entrepreneurship, is a special sort of human effort that takes on the risk of bringing labor, capital, and land together to produce goods. Entrepreneurship is the factor that organizes the other three.
- Entrepreneurship is the resource that brings resources together and organizes production.
- A business firm is the entity or organization used by entrepreneurship to engage in production.
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RESOURCES Labor, capital, land, and entrepreneurship used by society to produce consumer satisfying goods and services. Resources are often given the more descriptive term factors of production.
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BEIGE MUNDORTLE [What's This?]
Today, you are likely to spend a great deal of time at an auction wanting to buy either a remote controlled ceiling fan or a how-to book on home decorating. Be on the lookout for slow moving vehicles with darkened windows. Your Complete Scope
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Natural gas has no odor. The smell is added artificially so that leaks can be detected.
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"We succeed in enterprises (that) demand the positive qualities we possess, but we excel in those (that) can also make use of our defects." -- Alexis de Tocqueville, Statesman
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