| A | B |
|---|
| Allocative efficiency | When no resources are wasted |
| Average revenue | Total revenue divided by the quantity sold |
| Break even point | Where total revenue equals total cost |
| Competition | A contest for command over scarce resources |
| Duopoly | Where two producers of a product compete with each other |
| Economic efficiency | Where the cost of production is as low as possible |
| Economies of scope | Decreases in average total cost by increasing no. of products |
| Exteranl diseconomies | Factors outside the control of a firm that raise its costs |
| External economies | Factors beyond the control of a firm that lower its costs |
| Barriers to entry | Restrictions to the entry of new firms into an industry |
| Marginal revenue | The change in total revenue resulting from a one-unit change in the quantity sold |
| Marginal social benefit | The dollar value of the benefit from one additional unit of consumption |
| Monopoly | A market which has sole supply of a good with no close substitutes and has a barrier |
| Perfect competition | Large no. of firms, many buyers, identical product, no restrictions on entry, no advantages |
| Price taker | A firm that cannot influence the price of its product |
| Rent seeking | The activity of attempting to create a monopoly |
| Producer surplus | Difference between a producer's total revenue and the opportunity cost of production |
| Total revenue | The amount received from the sale of a product |
| Entry | Setting up a new firm in an industry |
| Exit | Closing down a firm and leaving an industry |
