Quick start again. We’re apparently going to have to do a project on some economic entity or event. Needs to be current. Topic is our choice. Project reports will need
- a title,
- introduction,
- some form of statement of objectives,
- some discussion of the theoretical aspects of the problem
- Collection and analysis of the data on the subject
- Statement of findings
- Suggestions for future action on the subject
- A brief summary of findings.
The report needs to be minimum four pages, double-spaced, font size twelve. In addition to the four pages of text, there must be a cover page and bibliography. There must be at least three references cited, of which at least one should ideally not be internet-based. Maximum length is nine pages; the closer the report length is to four pages, the better.
Back to costs.
- Average Fixed Cost is the total fixed costs of production divided by the units produced. A graph of average fixed costs is a downward sloping curve, with asymptotes at the x and y axis.
- Average Variable Cost is the total variable costs of production divided by the units produced. A graph of average variable cost will be U shaped, indicating the production is less efficient at the extremes of high and low production.
- Average Total Cost is the total costs of production divided by the units produced. A graph of Average Total Cost will be U shaped.
When average variable cost is declining, the marginal cost will be less than the average variable cost. When average variable cost is increasing, marginal cost is also increasing. The marginal cost curve, if graphed on the same axis as the average variable cost, will intersect the average variable cost curve at the avc curve’s minimum point. The same relationships exist between the marginal cost curve and the average total cost curve.
The Production Function is divided into two parts.
- The Short Period Production Function, also known as the law of diminishing returns.
- The Long-Period Production Function