| A | B |
|---|
| Law of Supply | rule stating that more will be offered for sale at high prices than at lower prices |
| supply schedule | tabular listing showing the quantities produced or offered for sale at each and every possible price in the market |
| supply curve | graphical representation of the quantities produced at each and every possible price in the market |
| market supply curve | supply curve that shows the quantities offered at various prices by all firms that sell the product in a given market |
| quantity supplied | amount offered for sale at a given price; point on the supply curve |
| change in quantity supplied | change in amount offered for sale in response to a price change; movement along the supply curve |
| subsidy | government payment to encourage or protect a certain economic activity |
| supply elasticity | responsiveness of quantity supplied to a change in price |
| short run | production period so short that only variable inputs can be changed |
| long run | production period long enough to change amount of variable and fixed inputs used in production |
| Law of Variable Proportions | rule stating that short-run output will change as one input is varied while others are held constant |
| raw materials | unprocessed natural resources used in production |
| total product | total output or production by a firm |
| marginal product | extra output due to the addition of one more unit of input |
| stages of production | phases of production-increasing, decreasing, and negative returns |
| diminishing returns | stage of production where output increases at a decreasing rate as more units of variable input are added |
| fixed cost | cost of production that does not change when output changes |
| variable cost | production cost that varies as output changes; labor, energy, raw materials |
| total cost | variable plus fixed cost; all costs associated with production |
| marginal cost | extra cost of producing one additional unit of production |
| total revenue | total receipts; price of goods sold times quantity sold |
| marginal revenue | extra revenue from the sale of one additional unit of output |
| break-even point | production level where total cost equals total revenue |
