Peter EMxx

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Economic Costs

Short-Run and Long-Run

Short-Run Production

Relationships


Costs

Short-Run Costs

Graphically

Productivity and Cost

Curves

Long-Run Production

Costs

Economies and

Diseconomies of Scale

Minimum Efficient Scale

and Industry Structure

Key Terms

www.Peter-Andrian.com

The Costs of Production

Kelompok 3: Peter ; Hilda ;

Bani ; Fajar ; Bagus ; Desfin

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


ECONOMIC COSTS

Economic Costs orOpportunity Costs

Forgoing theopportunity to produce

alternative goods and

services

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


Treated as a cost

Required to attract &

retain resources

Economic or Pure Profits

EconomicProfit

TotalRevenue

Economic Cost

Normal Profits

ECONOMIC COSTS

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


TR,

TC

Q0 Q1 Q2

Q3

TFC

TVC

TC

TR

BEP

Laba

Rugi

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


EconomicProfit

Implicit costs(including a

normal profit)

ExplicitCosts

Accountingcosts (explicit

costs only)

AccountingProfit

Economic(opportunity)Costs

TO

TAL

R

EVENU

E

Profits to anEconomist

Profits to anAccountant

ECONOMIC COSTS

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


Average Product (AP)

Total Product (TP)

Marginal Product (MP)

SHORT-RUN PRODUCTION

RELATIONSHIPS

Marginal Product =Change in Total Product

Change in Labor Input

Average Product =Total Product

Units of Labor

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


Law of Diminishing Returns


RELATIONSHIPS

TotalProduct,TP

Quantity of Labor

AverageProduct,A

P,and

MarginalProduc

t,MP

Quantity of Labor

Total Product

Marginal

Product

AverageProduct

IncreasingMarginalReturns
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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms




RELATIONSHIPS

TotalProduct,TP

Quantity of Labor

AverageProduct,AP,and

MarginalProduc

t,MP

Quantity of Labor

Total Product

Marginal

Product

AverageProduct

DiminishingMarginalReturns
http://highered.mcgraw-hill.com/sites/0072819359/student_view0/chapter22/origin_of_the_idea.html

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms




RELATIONSHIPS

TotalProduct,TP

Quantity of Labor

AverageProduct,AP,and

MarginalProduc

t,MP

Quantity of Labor

Total Product

Marginal

Product

AverageProduct

NegativeMarginalReturns
http://highered.mcgraw-hill.com/sites/0072819359/student_view0/chapter22/origin_of_the_idea.htmlhttp://highered.mcgraw-hill.com/sites/0072819359/student_view0/chapter22/origin_of_the_idea.html

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


Fixed CostsTotal Fixed Costs

Average Fixed Costs =Total Fixed Costs

Quantity

Variable Costs

Total Variable Costs

Average Variable Costs =Total Variable Costs

Quantity

SHORT-RUN PRODUCTION COSTS

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


Total CostTotal Fixed and Variable Costs

Average Total Cost =Total Costs

Quantity

Marginal Cost

Total Variable Costs

Marginal Cost =Change in Total Costs

Change in Quantity

SHORT-RUN PRODUCTION COSTS

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms

www.Peter-Andrian.com Marginal Cost= MC

Total Fixed Costs= TFCTotal Variable Costs= TVC

Average Variable Costs= AVC

Total Costs= TC

Average Total Costs= ATC

Average Fixed Costs= AFC

Summary of DefinitionsSHORT-RUN PRODUCTION COSTS

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


SHORT-RUN COSTS GRAPHICALLY

Quantity

Costs(dollars)

TC

Total

Cost

Fixed Cost

TVC

Variable Cost

TFC

Combining TVCWith TFC to get

Total Cost

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


SHORT-RUN COSTS GRAPHICALLY

Quantity

Costs(dollars)

AFC

AVC

ATC

MC

Plotting Average and

Marginal Costs
http://highered.mcgraw-hill.com/sites/0072819359/student_view0/chapter22/interactive_graphs.html

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


PRODUCTIVITY AND COST CURVES

Costs(do

llars)

AverageProdu

ctand

MarginalProduct

Quantity of labor

Quantity of output

MP

AP

MCAVC

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


Proses produksi yang sudah tidak menggunakaninput tetap, seluruh biaya produksi adalah

variabel.

Perilaku biaya produksi jangka panjang;

keputusan penggunaan input variabel oleh

perusahaan dalam jangka pendek.

Fungsi biaya jangka panjang; Biaya rata-rata

jangka panjang (LAC), Biaya marjinal jangkapanjang (LMC), yang diperoleh dari biaya total

jangka panjang (LTC).

Analisis Biaya Jangka Panjang

(Long-run average cost atau LAC)

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


LONG-RUN PRODUCTION COSTS

All such plant capacities

can be plotted.

For every plant capacitysize...

there is a short-run ATC

curve.

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms



UnitCo

sts

Output

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms



UnitCo

sts

Output

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms



The long-run ATCjust envelopesall of the short-run ATC curves.

UnitCo

sts

Output

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms



UnitCo

sts

Output

long-run ATC

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


SYARAT PEMAKSIMUMAN

KEUNTUNGAN

Memproduksi barang pada tingkat dimana

perbedaan antara hasil penjualan total

dengan biaya total paling maksimum

TR TC = maksimum

Memproduksi barang pada tingkat dimana

perbedaan antara hasil penjualan

marginal = biaya marginal.

MR = MC.

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


ECONOMIES AND

DISECONOMIES OF SCALE

Labor Specialization Managerial

Specialization Efficient Capital

Other FactorsDiseconomies of ScaleConstant Returns to Scale

graphically presented...

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


ECONOMIES AND


UnitCost

s

Output

long-run ATC

Economies

of scale

Constant returns

to scale

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


ECONOMIES AND


UnitCost

s

Output

long-run ATC

Where extensive

economies of

scale exist

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms


ECONOMIES AND


UnitCost

s

Output

long-run ATC

Where economies

of scale arequickly exhausted

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Economic Costs



Relationships


Costs

Short-Run Costs

Graphically


Curves

Long-Run Production

Costs

Economies and




Key Terms

Peter EMxx

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Transcript of Peter EMxx