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DISECONOMIES OF SCALE: Increasing long-run average cost that occurs as a firm increases all inputs and expands its scale of production. This is graphically illustrated by a positively-sloped long-run average cost curve and typically occurs for relatively large levels of production. Diseconomies of scale overwhelm by economies of scale for relatively large production levels. Together, economies of scale and diseconomies of scale cause the long-run average cost curve to be U-shaped.
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Lesson 1: Economic Basics | Unit 1: Economics
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Economics: A social science that studies the allocation of scarce resources used to produce goods and services that satisfy consumers' unlimited wants and needs.Key points in the study of economics: - Social Science: Economics uses the scientific method to explain and study our society.
- Allocation: Economics studies allocation decisions about distributing resources, goods and services.
- Scarce Resources: The economy's resources are limited relative to their use.
- Production: We transform available resources into goods and services. That's production.
- Consumption: The goods and services produced are used to satisfy wants and needs. That's consumption.
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PRODUCTION POSSIBILITIES SCHEDULE A table of numbers that illustrates the production possibilities of an economy--the alternative combinations of two goods that an economy can produce with given resources and technology. A production possibilities schedule illustrates that the economy must give up the production of one good to produce another good--the basic economic notion of opportunity cost. A production possibilities schedule is also used to derive the highly useful production possibilities curve (or frontier).
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John Maynard Keynes was born the same year Karl Marx died.
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"Progress always involves risk. You can't steal second base and keep your foot on first. " -- Frederick B. Wilcox
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NSE
Nagoya Stock Exchange (Japan)
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