Google
Wednesday 
September 22, 2021 

AmosWEB means Economics with a Touch of Whimsy!

AmosWEBWEB*pediaGLOSS*aramaECON*worldCLASS*portalQUIZ*tasticPED GuideXtra CrediteTutorA*PLS
PERFECT COMPETITION AND SHORT-RUN SUPPLY CURVE: A perfectly competitive firm's supply curve is that portion of its' marginal cost curve that lies above the minimum of the average variable cost curve. A perfectly competitive firm maximizes profit by producing the quantity of output that equates price and marginal cost. As such, the firm moves along it's marginal cost curve in response to alternative prices. Because the marginal cost curve is positively sloped due to the law of diminishing marginal returns, the firm's supply curve is also positively sloped.

Visit the GLOSS*arama


VARIABLES:

Quantities, usually represented as symbols, that can take on one of a set of values. A variable is "variable" because its value can "vary." A primary goal of economic analysis is to determine the specific value that a variable takes on under specific circumstances.
Variables are allowed to vary, to take on different values. Models combine variables in a systematic manner (based on the underlying theory). The basic purpose of a model is then to identify different, specific values for the variables.

For example, the two key variables in a market model are price and quantity. Analysis of the market model then identifies specific values for price and quantity.

Endogenous and Exogenous

In the analysis of a model, variables generally take one of two forms -- endogenous (or dependent) and exogenous (or independent).
  • Endogenous: The values of endogenous or dependent variables are identified within the workings of the model. For example, price and quantity are endogenous variables for the market model. Endogenous variables are, in essence, the "output" of the model. Their identification is what the model is all about.

  • Exogenous: The values of exogenous or independent variables are established outside the workings of the model. For example, income or the cost of a productive resource are common exogenous variables for the market model. Exogenous variables are the "input" of the model. They are pre-determined or "given" to the model.

Interaction

The interaction among endogenous and exogenous variables is key to the analysis of a model. Endogenous variables in a model are identified based on the pre-determined values of exogenous variables. Should these exogenous variables take on different values, then the endogenous variables also generally take on different values.

For example, endogenous price and quantity variables identified in a market model are, in part, based on the exogenous variable--the income of the buyers. Should buyers have more or less income, then their demand is likely to change and so too are price and quantity.

<= VARIABLE INPUTVAULT CASH =>


Recommended Citation:

VARIABLES, AmosWEB Encyclonomic WEB*pedia, http://www.AmosWEB.com, AmosWEB LLC, 2000-2021. [Accessed: September 22, 2021].


Check Out These Related Terms...

     | empirical | model |


Or For A Little Background...

     | scientific method | abstraction | cause and effect | ceteris paribus | comparative statics | principle | hypothesis | marginal analysis | economic analysis |


And For Further Study...

     | science | economic thinking | economic science | seven economic rules | fallacies | positive economics |


Search Again?

Back to the WEB*pedia


APLS

ORANGE REBELOON
[What's This?]

Today, you are likely to spend a great deal of time waiting for visits from door-to-door solicitors hoping to buy either one of those memory foam pillows or a remote controlled train set. Be on the lookout for broken fingernail clippers.
Your Complete Scope

This isn't me! What am I?

Ragnar Frisch and Jan Tinbergen were the 1st Nobel Prize winners in Economics in 1969.
"Always remember that striving and struggle precede success, even in the dictionary. "

-- Sarah Ban Breathnach, writer

TIFFE
Tokyo International Financial Futures Exchange (Japan)
A PEDestrian's Guide
Xtra Credit
Tell us what you think about AmosWEB. Like what you see? Have suggestions for improvements? Let us know. Click the User Feedback link.

User Feedback



| AmosWEB | WEB*pedia | GLOSS*arama | ECON*world | CLASS*portal | QUIZ*tastic | PED Guide | Xtra Credit | eTutor | A*PLS |
| About Us | Terms of Use | Privacy Statement |

Thanks for visiting AmosWEB
Copyright ©2000-2021 AmosWEB*LLC
Send comments or questions to: WebMaster