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Related Flashcards
Related Topics
Cards In This Set
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Market power
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The ability to alter the market price of a good or service
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Market demand
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The total quantities of a good or service people are willing and able to buy at alternative prices in a given time period; the sum of individual demands
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Patent
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Government grant of exclusive ownership of an innovation
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Monopoly
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A firm that produces the entire market supply of a good or service
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Marginal revenue
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The change in total revenue that results from a one unit increase in quantity sold
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Profit maximization rule
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Produce at that rate of output where marginal revenue equals marginal cost
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Production decision
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The selection of the short-run rate of output (with existing plant and equipment
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Barriers to entry
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Obstacles that make it difficult or impossible for would-be producers to enter a particular marker; e.g. patents
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Marginal cost pricing
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The offer of goods at prices equal to their marginal cost
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Economies of scale
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Reductions in minimum average costs that come about through increases in the size of plant and equipment
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Natural monopoly
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An industry in which one firm can achieve economies of scale over the entire range of market supply
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Contestable market
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An imperfectly competitive industry subject to potential entry if prices or profits increase
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Labor supply
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The willingness and ability to work specific amounts of time at alternative wage rates in a given time period, ceteris paribus
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Opportunity cost
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The most desired goods and services forgone in order to obtain something else
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Market supply of labor
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The total quantity of labor that workers are willing and able to supply at alternative wage rates in a given time period, ceteris paribus
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