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DEPRECIATION, CAPITAL: The wearing out, breaking down, or technological obsolescence of physical capital that results from use in the production of goods and services. To paraphrase an old saying, "You can't make a car without breaking a few socket wrenches." In other words, when capital is used over and over again to produce goods and services, it wears down from such use.
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Lesson 15: Cost | Unit 2: Three Totals
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Page: 5 of 24
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Topic:
Fixed And Variable
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- The comprehensive measure of the total cost of production is total cost.
- Total cost is the total opportunity cost incurred by all of the factors of production used by a firm to produce output.
- Because short-run production involves variable and fixed inputs, it's useful to separate total cost into total fixed cost and total variable cost.
- Total fixed cost is the total opportunity cost of production that DOES NOT change (or vary) with changes in the quantity of output produced by a firm in the short run.
- Total variable cost is the total opportunity cost of production that changes (or varies) with changes in the quantity of output produced by a firm in the short run.
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UTIL A hypothetical unit of measurement of utility that is commonly used by economists to present hypothetical information about utility and consumer demand theory. The util measurement unit was developed as a convenient way to illustrate and discuss concepts such as total utility, marginal utility, and the law of diminishing marginal utility. However, because utility is not a measurable characteristic, the util does represent an actual unit of measurement, such as inches or pounds.
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YELLOW CHIPPEROON
[What's This?]
Today, you are likely to spend a great deal of time at a going out of business sale wanting to buy either a genuine down-filled pillow or one of those "hang in there" kitty cat posters. Be on the lookout for rusty deck screws.
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Approximately three-fourths of the U.S. paper currency in circular contains traces of cocaine.
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"The past is a foreign country; they do things differently there." -- Leslie Poles Hartley, Writer
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ILO
International Labor Office
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