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PERFECT COMPETITION, TOTAL ANALYSIS: A perfectly competitive firm produces the profit-maximizing quantity of output that generates the greatest difference between total revenue and total cost. This total approach is one of three methods that used to determine the profit-maximizing quantity of output. The other two methods involve the direct analysis of economic profit or a comparison of marginal revenue and marginal cost.

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Lesson 12: Business Cycles | Unit 5: Policies Page: 24 of 26

Topic: Expansionary <=PAGE BACK | PAGE NEXT=>

Expansionary policies avoid or limit the problems of business cycle contractions.
  • Expansionary fiscal policy is increasing government spending or reducing taxes. More spending can offset the decline in investment, directly. Lower taxes leaves households with more income from consumption.
  • Expansionary monetary policy is increasing in the amount of money in circulation. More money means more spending.

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PRODUCER SURPLUS

The revenue that producers obtain from a good over and above the price paid. This is the difference between the minimum supply price that sellers are willing to accept and the price that they actually receive. A related notion from the demand side of the market is consumer surplus.

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APLS

PINK FADFLY
[What's This?]

Today, you are likely to spend a great deal of time flipping through mail order catalogs hoping to buy either a flower arrangement for that special day for your mother or a New York Yankees baseball cap. Be on the lookout for letters from the Internal Revenue Service.
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This isn't me! What am I?

The standard "debt" notation I.O.U. does not mean "I owe you," but actually stands for "I owe unto..."
"The time to repair the roof is when the sun is shining."

-- John F. Kennedy, 35th U. S. president

AACCLA
Association of American Chambers of Commerce in Latin America
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