PRODUCTION COST: The opportunity cost of using labor, capital, land, and entrepreneurship in the production of goods and services. Production cost is important to supply. The price received by a seller must be great enough to cover production cost. Note that production cost includes what you probably think of as the traditional "cost of doing business," but it includes other less obvious costs, as well. While labor, capital, and land typically involve an explicit cost--an actual money payment--the cost of entrepreneurship is often an implicit cost. In particular, the cost of entrepreneurship is termed normal profit.

     See also | opportunity cost | labor | capital | land | entrepreneurship | production | good | service | supply | resource prices | wage | interest | rent | profit | aggregate supply | short-run aggregate supply |

PRODUCTION COST, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2021. [Accessed: December 8, 2021].

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The intercept of the saving line indicates autonomous saving, saving that does not depend on the level of income or production. This can be thought of as the baseline level of saving that would be undertaken if income falls to zero. Autonomous saving is affected by the consumption expenditures determinants, which cause a change in the intercept and a shift of the saving line. The value of the intercept of the saving line is the negative of the value of the intercept of the consumption line.

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