Unit 3 Costs of Production

Introduction to Market Structure

Power Point for Accounting Profit vs Economic Profit

Costs of Production 

Objectives:

1. Explain the law of diminishing returns
2. Compute marginal and average product when given total product data
3. Explain the relationship between total, marginal, and average productDistinguish between fixed, variable and total costs

1. Explain the difference between average and marginal costs
2. Compute and graph AFC, AVC, ATC, and marginal cost when given total cost data
3. Explain how AVC, ATC, and marginal cost relate to one another
4. Relate average product to average variable cost, and marginal product to marginal cost

1. Explain what can cause cost curves to rise or fall
2. Explain the difference between short‑run and long‑run costs
3. State why the long‑run average cost is expected to be U‑shaped
4. List causes of economies and diseconomies of scale
5. Indicate relationship between economies of scale and number of firms in an industry
6. Understand the relationship between the shape of a long-run ATC curve and market structure

Power Point for Costs of Production

Video: Law of Diminishing Marginal Product

Video: Understanding the relationship between Total, Marginal, and Average Product

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Video: Productivity and Costs of Production

Online Tutorials
Cost Curves
Average Cost Curves
Explicit and Implicit Costs
Short Run and Long Run Costs

Interactive Cost Curves (EXCELLENT PRACTICE!!!)
Cost Table!!
Cost Curves

Practice Test for Costs/Cost Curves

Perfectly Competitive Markets