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ECON Exam 2 Part 1
| Term | Definition |
|---|---|
| TC (Total Costs) | Sum of all costs of production, including both fixed and variable costs. |
| TB (Total Benefits) | The total value or satisfaction gained from consuming goods. |
| MC (Marginal Cost) | The additional cost from producing one more unit of output. |
| MB (Marginal Benefit) | The additional benefit from consuming one more unit of a good. |
| P (Price) | The market value per unit of a good or service. |
| Q (Quantity) | The amount of a good bought or sold in a market. |
| S (Supply) | Relationship showing how much producers are willing and able to sell at various prices. |
| D (Demand) | Relationship showing how much consumers are willing and able to buy at various prices. |
| E (Equilibrium) | The point where quantity supplied equals quantity demanded; the market clears. |
| QS (Quantity Supplied) | The amount of a good producers are willing and able to sell at a given price. |
| QD (Quantity Demanded) | The amount of a good consumers are willing and able to buy at a given price. |
| TP (Total Product) | The total amount of output produced using a given amount of inputs. |
| MPL (Marginal Product of Labor) | The additional output produced by employing one more unit of labor. |
| T∏ (Total Profit) | Total revenue minus total cost; overall profit from production. |
| M∏ (Marginal Profit) | The change in total profit from producing one additional unit. |
| TR (Total Revenue) | Total income from selling goods. |
| TVC (Total Variable Cost) | Total cost of inputs that vary with the level of output. |
| TFC (Total Fixed Cost) | Costs that do not change with the level of output. |
| ATC (Average Total Cost) | Total cost per unit of output. |
| AVC (Average Variable Cost) | Variable cost per unit of output. |
| MR (Marginal Revenue) | Additional revenue from selling one more unit. |
| AR (Average Revenue) | Revenue per unit sold; equal to price in most markets. |
| SR (Short Run) | A period in which at least one input is fixed. |
| LR (Long Run) | A period in which all inputs are variable; firms can enter or exit freely. |
| p.c. (Perfect Competition) | Market with many buyers and sellers, identical products, and no barriers to entry. |
| CS (Consumer Surplus) | The difference between what consumers are willing to pay and what they actually pay. |
| PS (Producer Surplus) | The difference between the price received and the minimum willingness to sell. |
| TS (Total Surplus) | The total net benefit to society; sum of consumer and producer surplus. |
| MWTP (Maximum Willingness to Pay) | The highest price a consumer is willing to pay for a good; reflects marginal benefit. |
| mwts (Minimum Willingness to Sell) | The lowest price a seller is willing to accept for a good; reflects marginal cost. |
| TU (Total Utility) | The total satisfaction received from consuming a certain amount of goods. |
| MU (Marginal Utility) | The additional satisfaction gained from consuming one more unit of a good. |
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