Textbook Guide Economics: Average Variable Cost, Marginal Cost, Marginal Product
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ECO101H1 Full Course Notes
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Profit = total revenue total cost: total revenue the total income of a firm from the sale of goods or services. Is equal to price x quantity: total cost is equal to fixed costs + variable costs. Fixed costs costs that a company will incur that are independent of the level of output. For example: rent, advertising and insurance are all costs that the firm will incur even if the level of output is zero. Variable costs costs that vary with the level of output. For example, raw material costs and labor costs. Opportunity cost refers to everything that must be forgone to acquire an item. For example, the opportunity cost of going to college includes 4 years of foregone wages that you would have earned had you worked instead: explicit costs out of pocket expenses. Can be any direct payment that is made in the course of running a business: implicit costs also called an implied cost.
