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IDENTIFICATION LAG: In the context of economic policies, the time between a shock to the economy and realization that the shock has occurred. This is one of several policy lags that limit the effectiveness of stabilization policies designed to correct business-cycle fluctuations. This is also one of two inside lags. The other is an implementation lag. Also termed recognition lag, the identification lag emerges due to the time needed to measure economic activity. While the lag is generally positive, it actually can be negative through accurate forecasting techniques. When negative policies can be undertaken to correct a problem before it occurs.
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Lesson 18: Monopoly | Unit 3: Output
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Page: 17 of 30
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Topic:
Marginal Numbers
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- Analysis of monopoly production in the short run also can be had with a comparison of marginal revenue and marginal cost values.
- These two marginal measures are presented in the fourth and sixth columns.
- Marginal Revenue (MR): The fourth column displays marginal revenue, which declines from a high of $10 per unit for the first unit to a low of -$1 per unit for the twelfth unit.
- Marginal Cost (MC): The sixth column presents the marginal cost. It starts at $7, declines to a low of $3.50, the rises again to $25.
- The monopoly would produce 7 units, where marginal revenue and marginal cost are equal.
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RATIONAL IGNORANCE The decision NOT to become informed about a topic (such as what a political candidate wants to do) because the cost of acquiring the information is more than the expected benefit. The rational decision to remain ignorant about a subject is a straightforward application of utility maximization and along with the related notion of rational abstention, is a source of voter apathy and government inefficiency.
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RED AGGRESSERINE
[What's This?]
Today, you are likely to spend a great deal of time at the confiscated property police auction looking to buy either a set of luggage with wheels or a birthday gift for your aunt. Be on the lookout for malfunctioning pocket calculators.
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Two and a half gallons of oil are needed to produce one automobile tire.
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"Sometimes when you innovate, you make mistakes. It is best to admit them quickly and get on with improving your other innovations. " -- Steve Jobs, Apple Computer founder
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ARP
Average Revenue Product
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