ECON 200 Chapter Notes - Chapter 12: Production Function, W. M. Keck Observatory, Average Cost
31 Jan 2018
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Learning objectives, define total revenue, total cost, and profit. Microeconomics: the costs of production: total revenue is the amount a firm receives from the sale of all goods and services while total cost is the amount a firm must pay to produce those goods or services. This implies that there is a point at which it becomes unprofitable for a business to expand its operations: the building blocks of business: revenues, costs, and profits, profit is the central goal of a business. Economists assume that a firm"s goal is to maximize profits: profit is revenue minus costs, the amount a firm receives from the sale of goods and/or services is total revenue. Elasticity total revenue is calculated as the quantity sold multiplied by the price received for each unit: the amount a firm pays for all of the inputs that go into producing goods and/or services is its total cost.
