AGBE 3320 Exam 1 Questions & Answers 2024/2025
total revenue - ANSWERStotal receipts from sales or a given quantity of goods or services. (TR=PxQ)
marginal revenue - ANSWERSthe revenue gained by producing one additional unit of a good or service. (MR=change in TR/change in output)
averag...
total revenue - ANSWERStotal receipts from sales or a given quantity of goods or services. (TR=PxQ)
marginal revenue - ANSWERSthe revenue gained by producing one additional unit of a good or service.
(MR=change in TR/change in output)
average revenue - ANSWERSrefers to the revenue per unit of output sold (AR=TR/units sold)
total cost - ANSWERStotal economic cost of production and is made up of variable costs. (TC=FC+VC)
fixed cost - ANSWERSbusiness costs, such as rent, that are constant whatever the quantity of goods or
services produced.
variable costs - ANSWERSthose costs that vary depending on a companies production volume; the rise as
production increases and fall as production decreases.
Average total cost - ANSWERSthe sum of all the production costs divided by the number of units that are
produced (ATC=TC/Q)
average fixed cost - ANSWERSare the fixed costs of production divided by the quantity of output
produced. (AFC=FC/Q)
average variable cost - ANSWERScosts that vary with output divided by the quantity of output produced
(AVC=VC/Q)
marginal cost - ANSWERSthe cost added by producing one additional unit of a product or service.
(MC=change in TC/change in Q).
, total physical product - ANSWERSmeasures the total output of a product, in physical units at various
levels of one variable input and fixed levels of another. (TPP=given # of quantity x what total product
given)
marginal physical product - ANSWERSmeasures the change in output, in physical units of product in
response to the use of an additional of the variable input. (MPP=change in TPP/change in input).
average physical product - ANSWERSmeasures the average output, in physical units of the product at
each level of the variable input. (APP=TPP/input).
total value product - ANSWERSmeasures the total output of a product, in value $ units, at various levels
of one variable input and fixed levels of others.
(TVP=TPP x Py)
marginal value product - ANSWERSmeasures the change in output of a product, in value $ units, at each
level of the variable input. (AVP=APP x Py).
total cost factor - ANSWERStotal opp. cost incurred by a firm from the employment of a given resource.
(TFC=factor price x factor quantity).
marginal factor cost - ANSWERSis the increment to total costs paid for a factor of production resulting
from a one-unit in the amount of the factor employed. (MFC=APP x AR).
output side - ANSWERSa producer needs to produce that quantity where MR=MC
TR
MR
AR
TC
FC
ATC
AFC
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