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Tuesday, May 19

  1. page The Relationship Between Market Supply and the MC Curves of Individual Firms edited A perfectly competitive firm maximizes profit by producing the quantity of output where marginal re…
    A perfectly competitive firm maximizes profit by producing the quantity of output where marginal revenue (marginal revenue = price in a perfectly competitive firm) equals marginal cost. A perfectly competitive firm's supply curve is the portion of its marginal cost curve that lies above the minimum of the average variable cost curve, because if the marginal cost curve was lower than the average variable cost curve, the firm would just shut down. A firm produces by moving along its supply curve, which in a perfectly competitive firm is the same as its marginal cost curve. Therefore, in individual firms in a perfectly competitive market, the graphs of market supply and marginal cost are the identical.
    ...
    a perfectly comitivecompetitive industry have
    {lecture-supply-supply.gif} {lecture-supply-mc.gif}
    The two graphs above are based on the same set of resources and prices (Jonathan's apples). The graph on the left shows the supply curve while the graph on the right shows the marginal cost curve. The graphs are exactly the same.
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  2. page The Relationship Between Market Supply and the MC Curves of Individual Firms edited A perfectly competitive firm maximizes profit by producing the quantity of output where marginal re…
    A perfectly competitive firm maximizes profit by producing the quantity of output where marginal revenue (marginal revenue = price in a perfectly competitive firm) equals marginal cost. A perfectly competitive firm's supply curve is the portion of its marginal cost curve that lies above the minimum of the average variable cost curve, because if the marginal cost curve was lower than the average variable cost curve, the firm would just shut down. A firm produces by moving along its supply curve, which in a perfectly competitive firm is the same as its marginal cost curve. Therefore, in individual firms in a perfectly competitive market, the graphs of market supply and marginal cost are the identical.
    ...
    a perfectly competitivecomitive industry have
    {lecture-supply-supply.gif} {lecture-supply-mc.gif}
    The two graphs above are based on the same set of resources and prices (Jonathan's apples). The graph on the left shows the supply curve while the graph on the right shows the marginal cost curve. The graphs are exactly the same.
    ...
    Link #4
    Answer to Samply Question: The correct answer is C because when the marginal cost becomes lower than the average variable cost, it would actually be more beneficial for a firm to just shut down rather than to continue operation. The first portion of the supply/MC curve is not shown in many data sets because the firm would never choose to supply at these points so they do not apply to the firm's production possibilities.

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Thursday, October 16

  1. page PPCs - Consumer vs. Capital Goods edited {ppc.jpg} This graph shows the PPC of consumer goods vs capital goods. If the country produces m…
    {ppc.jpg}
    This graph shows the PPC of consumer goods vs capital goods. If the country produces more capital goods than consumer goods, then the country is preparing for the future, rather than thinking only in present terms. This movie represents Cuba's shift toward consumer production rather than working toward the future with capital production.
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    for now. EachEach axis is
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    future respectively. SomeSome examples of
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    or medicine. TheyThey could raise
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    improve resources. GoodsGoods for the
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    or clothing. ConsumerConsumer goods are
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    and resources.
    There

    There
    is not
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    be produced. ThereThere is a
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    is produced. OnOn the PPC
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    are produced. HoweverHowever even though
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    the future. ItIt all depends
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    economic situation. ItIt is however,
    SAMPLE QUESTION W/ ANSWER:
    Looking back at the graph above, what is happening when you move from point D to point B on the graph?
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    http://ideas.repec.org/p/iim/iimawp/254.html
    http://www.thehindubusinessline.com/2005/02/17/stories/2005021702111300.htm
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    consumer goods. FromFrom producing more
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Wednesday, March 19

  1. page Inferior Goods edited ... In economics, a luxury good is a good for which demand increases more than proportionally as i…
    ...
    In economics, a luxury good is a good for which demand increases more than proportionally as income rises, contrast with inferior good and normal good.
    The Image above details the meaning of inferior goods where the person who has no money, obviously, become rich or some type of sort and able to do and buy much more than not being able to do or purchase a good that has a high price. above (right) This video is an example of a guy who has a low income and can only afford ramen (inferior good) but then he suddenly gets a raise and can now afford Lobster (normal good).
    Buying Canned Foods
    Link1
    Link 2
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    3:03 am

Monday, February 3

  1. page Law of Diminishing Returns edited The Law of Diminishing Marginal Returns is s the principle Essentially the Law of Diminishing M…
    The Law of Diminishing Marginal Returns iss the principle
    Essentially the Law of Diminishing Marginal Returns is responsible for the way that marginal product graph looks which affects the marginal cost graph because they are mirror images of each other, which then affects the average total cost graph ase the marginal cost graph is a magnet to the other two.
    {Tainter1.gif}
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  2. page Law of Diminishing Returns edited The Law of Diminishing Marginal Returns is the principle in short-run production stating that, as a…
    The Law of Diminishing Marginal Returns is the principle in short-run production stating that, as a firm combines more of a variable resource with a fixed resource, the marginal product of the variable resource eventually reaches a maximum point and then declines. This maximum point is where production is most efficient. The mirror image of marginal product is marginal cost, in that marginal cost decreases to that same certain point and then continues to increase after that.
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    cost graph and the average variable cost graph becausease the marginal
    {Tainter1.gif}
    This total product curve demonstrates the law of diminishing marginal returns because the benefits will eventually decrease as capacity increases after a certain point.
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Tuesday, November 12

  1. page The Economizing Problem edited The Economizing Problem is the fact that people have unlimited wants, but limited or scarce goo…

    The Economizing Problem is the fact that people have unlimited wants, but limited or scarce goods to satisfy those wants. For example, people expect there to always be available gasoline to run their cars on, they have an unlimited want for gasoline. But the planet and the country has only so much oil that they can use for making gasoline for the people. So therefore the people will eventually be unhappy due to the shortage of gasoline.
    A resource is considered scarce when its availability is not enough to meet its demand. Limited capibilities such as technology or a limited supply of resources such as land, water,or people, are causes of scarcity oif goods and services. Pricing systems are very often placed in order to hold back scarcity of goods. As the good or service becomes more and more scarce, the price gets higher and higher so that people will be less likely to buy out the goods or services completely.
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Monday, April 29

  1. page Rent-Seeking Behavior edited ... gets a copywrite copyright on their For example, let's look at a company that makes shoes…
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    gets a copywritecopyright on their
    For example, let's look at a company that makes shoes. Yesterday, this shoe company lobbied for subsidies and a grant from the government. This action did not create benefit for society, but it did increase their own costs to do so (it cost them their time to lobby to the government) so it would be considered a rent-seeking behavior.
    {http://mysite.verizon.net/vze7ve0j/Reebok_Logo_1.gif} Reebok is an example of a shoe company.
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    Link Two
    Link Three

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Thursday, December 18

  1. page Game Theory 7 edited Name of the Game: Sneaky Eyes General Description of the Game: This is a game of trust and strateg…
    Name of the Game: Sneaky Eyes
    General Description of the Game: This is a game of trust and strategy because the players don't truly find out the final outcomes/scores until the end of the game.
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    each round. It would result in the best combined outcomes for the players if the 2 players made an agreement to each keep their eyes closed as shown below in the matrix. The reason
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    the outcomes after each round is to
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    on the rightleft and player
    keep eyes closed
    open eyes
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    9:21 pm
  2. page Game Theory 7 edited ... open eyes +5 , -3 -5 -2 , -5 -2 Materials Required: A piece of paper and a pencil. …
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    open eyes
    +5 , -3
    -5-2 , -5-2
    Materials Required: A piece of paper and a pencil.
    Predicted Results: The Nash Equilibrium for this game will be the bottom right box with both players choosing to open their eyes, which happens to be the dominant strategy for both players in this situation. For example, if player #1 chooses to keep their eyes closed, player #2 either earns 3 points by being loyal and keeping their eyes closed as well or earns 5 points by cheating and opening their eyes. Clearly, player #2 will benefit more from cheating. If player #1 decides to cheat (opening their eyes) player #2 can either lose 3 points by being loyal (keeping their eyes closed) or only lose 2 points by cheating as well. So, no matter what player #1 chooses, it is better for player #2 to cheat and open their eyes. It is the situation for player #1 as well. This is the worst box for the players to be in but the Nash Equilibrium almost always works that way.

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    9:16 pm

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