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marketing economies these are derived from the bulk purchasing of inputs and bulk distribution of outputs a large firm is able to buy its raw
technical economies they are economies that accrue from the use of large machines with emphasis on full utilization and efficiency in production
internal and external economies of scaleinternal economies of scale are the advantages or benefits that the firm enjoys as it expands its size or
marginal revenuemarginal revenue is the change in total revenue with respect to a change in quantity sold that is it is the change in total revenue
explicit costexplicit costs are payments made by the firm when it purchases or hires factors of production for the production of goods and services
social costsocial cost of production refers to the cost incurred by a society when its economic resources are used to produce a given commodity the
revenue and profit maximizationwhenever a good is produced the individual firm which has produced incurs costs which are are referred to as private
disadvantages of division of labourdivision of labour may also have disadvantages that may include the followingi lack of craftsmanshipdivision of
advantages of division of labourdivision of labour has advantages including the followingdevelopment of greater skill by the worker in division of
division of labourdivision of labour involves dividing a production process into a number of smaller tasks for each task to be undertaken by a
location of industry and localization of industrylocation of industry tries to answer the key economic question where to produce it involves deciding
increasing returns to scale and decreasing returns to scaleincreasing returns to scale occur when increases in all inputs by a certain percentage
short run production period and long run production periodthe short run is a period of production during which some factors of production are fixed
fixed input and variable inputa fixed input is that input whose quantity cannot be varied in the short-run when demand conditions require an increase
entrepreneurthe entrepreneur or enterprise is a special factor of production that is in charge of the organization of the other three factors of
production processproduction is a process that transforms factors of production or inputs into output of goods and services production may be
use of income elasticity of demandincome elasticity of demand on the other hand has the following usesi income elasticity of demand shows how the
uses of price and income elasticity of demandthe concept of price elasticity of demand has some uses whihc include the followingi pricing of goods
factors determine the price elasticity of supplythe price elasticity of supply varies widely across different products some products have more
durability of the commoditywith some commodities we require one at a time and they are used for a very long time before they get spoilt examples of
uses and habit forming commodity -price elasticity of demandthe number of possible usesa commodity has high price elasticity of demand or elastic
factors that calculate price elasticity of demandthe proportion of income spent on the commodityif the price of a good is relatively low such the
closesubstitute goodsthe number of closesubstitute goodsthe more substitutes of good has and the more close the substitutes are the more elastic the
derived demand and demand schedulederived demand is where the demand for a final product leads to the demand for a second product which is used to
determinants of quantity supplied of a good the quantity of supplied of a product is influenced by factors such as the market price of the commodity