| A | B |
|---|
| Supply | How much of a good producers are willing & able to offer per period at each price OTC. |
| Law of supply | Quantity supplied directly related to its price OTC. |
| Elasticity of Supply | Measure of responsiveness of quantity supplied to price change. |
| Supply curve | Curve or line showing quantity of goods supplied at different prices for a given period. |
| movement along a supply curve | Changes in quantity supplied resulting from a change in the price of a good, OTC. |
| Shift of a supply curve | Increase or decrease in supply resulting from a change in one of determinants of supply other than price. |
| short run | A period in which price of firm's resources is fixed |
| long run | A period in which all resources can be varied. |
| total product | Total output of the firm. |
| Law of diminishing returns | As more of variable resource is added to a given amount of fixed resources, marginal product eventually decreases & becomes negative. |
| fixed cost | Any production cost that changes as output changes. |
| total cost | The sum of fixed cost and variable cost. |
| marginal cost | The change in total cost resulting from a 1 unit change in output. CHange in total costdivided b change in quantity. |
| marginal revenue | Change in total revenue from selling another unit of the good. |
| competitive firm's supply curve | Rising position of a firm's marginal cost curve at and above minimal acceptable price. |
| economics of scale | Forces that reduce a firm's average cost as the firm's size or scale increases in the long run. |
| long run average curve | A curve that shows the lowest average cost of producing each level of output. |
| variable cost | Any production cost that changes as output changes. |
