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ECON 202
Lecture 9 Vocab
| Term | Definition |
|---|---|
| an individual who, in hopse of earning a residula profit (while accepting the risk of a resudual loss), organizes and coordinates resurces to produce goods | entrepreneur |
| identifying potential demand where little or no competitioon exists | blue ocean strategy |
| the individual that assumes the risk of creating or owning a firm; is paid last | residual claimants |
| an individual who creates a new goodo r an idea for a good | inventor |
| an individual who introduces and markets new goods | innovator |
| an individual who copies and markets existing ogods | imitator |
| an individual who buys and sells goods inhopes of earning a profit from price differences | speculator |
| the opportunity to earn a profit form buying at a low price in one time or place and selling at a higher price in another time or place | arbitrage |
| unpredictable, indefinite events; impies incalculable odds; the likelihood of an event cannot be calculated efficiently | uncertainty |
| exposure to the chance of loss; implies that some event may be calculated efficiently | risk |
| a plan to spread or share risk among parties with imilar risks | insurance |
| th erecognition of a governing authority to an individual;s right to profit from his own creations, ideas, inventions, etc. | intellectual property |
| a right granted by the owner to use intellectual property | license |
| a payment for the use of intellectual property owner by another | royalties |
| a legal right to profit form an invention or innovation | patents |
| a legal right to profit from an artistic creation | copyrights |
| a legal rigth to preserve and protect a naem, logo, etc. | trademarks |
| how producers use resources; how th ecosts associated with production "behave" | cost structure |
| any time frame i nwhich at least on e resource, cost, or productive activity cannot vary | short-run |
| any time frame in which any resource, cost, or productive activity can vary | long-run |
| a producer's total output | total product |
| the change in total product when a resource increases by one unit and all other resources are unchanged | marginal product |
| a producer's choices of what resources and how much to allocate to produce a target amount of output | production function |
| as more of a variable resources is added to a given amount of other resources, marginal product eventually declines and could become negative | law of diminishing marginal returns |
| a resource that cannot be changed easily or quickly (long-run assumption) | fixed resources |
| costs that are incurred before production can begin | fixed costs |
| any resource that can be changed quickly or easily (short-run assumption) | variable resources |
| costs of only the resources that are used to make a single uint | variable costs |
| the chagne in total cost resulting from a change of one unit in output; the chagne in total cost divided by the change in total output, or MC = /\TC / /\q | marginal cost |
| equals fixed costs plus variable costs; TC = FC + VC | total costs |
| the difference between total costs of the firm and totla fixed costs divided by total units produced; AVC = VC / q | averge variable cost |
| total costs of the firm divided by total unity produced; ATC = TC / q or also, ATC = AFC + AVC | average total cost |
| a condition that occurs if, over some range of output, long-run average cost neither increases nor decreases with changes in firm size | constant long-run average cost |
| th erisk tht the average total cost per unit exceeds the average price per unit | risk-taking and goal of the firm |
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nomad95
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