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AGGLOMERATION ECONOMIES: A reduction in production cost the results when related firms locate near one another. Firms can be related as competitors in the same industry, by using the same inputs, or through providing output to the same demographic group. The fashion industry, for example, experiences agglomeration economies because they can share specialized inputs (photographers, models) that would be too expensive to employ full time. Retail stores have agglomeration economies when located in shopping malls because they have access to a large group of potential customers with lower advertising cost. Agglomeration economies is given as one of the primary reasons for the emergence of urban areas.
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Lesson 4: Production Possibilities | Unit 3: The Curve
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Page: 9 of 24
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We can transform the schedule of production possibility numbers into a graph.- Each bundle can be represented by a point in two dimensional production possibilities space.
- The two dimensions of the space are clock calibrators on the horizontal axis and jogging shoes on the vertical axis.
- The horizontal axis is measured between 0 and 11 calibrators.
- The vertical axis is measured between 0 and 500 jogging shoes.
- The two axis are joined at the origin.
- The plotted bundles form a semi-circle pattern.
- If these were stars in the night sky we might name it the arc of production. But it's not, so we won't.
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FIRM OBJECTIVES The standard economic assumption underlying the analysis of firms is profit maximization. Real world firms, however, might not, and many times do not, make decisions based on the profit-maximization objective, or at least exclusively on the profit-maximization objective. Other objectives include: (1) sales maximization, (2) pursuit of personal welfare, and (3) pursuit of social welfare.
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BLUE PLACIDOLA
[What's This?]
Today, you are likely to spend a great deal of time flipping through the yellow pages seeking to buy either a coffee cup commemorating the first day of spring or a printer that works with your stockpile of ink cartridges. Be on the lookout for the happiest person in the room.
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This isn't me! What am I?
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A thousand years before metal coins were developed, clay tablet "checks" were used as money by the Babylonians.
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"Old age isn't so bad when you consider the alternative. " -- Cato, Roman orator
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NASD
National Association of Securities Dealers
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