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INCREASING OPPORTUNITY COST: The proposition that opportunity cost, the value of foregone production, increases as more of a good is produced. This 'law' is most important to the slope of the production possibilities curve. It generates the convex shape of the curve, making the curve flat at the top and steep at the bottom.
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Lesson 16: Perfect Competition | Unit 5: Evaluation
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Page: 26 of 28
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- Unfortunately all is NOT perfect with perfect competition, it has three key failures.
- First, perfect competition provides no incentive to innovate, grow, and expand.
- Second, perfect competition provides no incentive nor way to achieve differences.
- Third, perfect competition is an idealized market structure designed to highlight the extreme possibility of perfect efficiency.
- In spite of these imperfections perfect competition provides an invaluable tool in the study of markets, market structures, and efficiency.
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MARGINAL FACTOR COST, MONOPSONY The change in total factor cost resulting from a change in the quantity of factor input employed by a monopsony. Marginal factor cost, abbreviated MFC, indicates how total factor cost changes with the employment of one more input. It is found by dividing the change in total factor cost by the change in the quantity of input used. Marginal factor cost is compared with marginal revenue product to identify the profit-maximizing quantity of input to hire.
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BLUE PLACIDOLA
[What's This?]
Today, you are likely to spend a great deal of time lost in your local discount super center wanting to buy either a 50 foot extension cord or a combination CD player, clock radio, and telephone (with answering machine). Be on the lookout for cardboard boxes.
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This isn't me! What am I?
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Al Capone's business card said he was a used furniture dealer.
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"The greatest things ever done on Earth have been done little by little. " -- William Jennings Bryan
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MR
Marginal Revenue
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