The Dynamics of Markets: Effects of Cost and Revenue (Grade 11 NSC Matric Economics): Flashcards
📚Flashcards
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Practise the cards
10 cards from this deck
Long run in economics
Long run in economics
All inputs variable; complete flexibility for businesses
Short vs long run distinction
Short vs long run distinction
Ability to change all factors, not time duration
LRAC curve
LRAC curve
Long run average cost when all inputs can be varied
Envelope curve
Envelope curve
LRAC curve enveloping all SRAC curves
Returns to scale
Returns to scale
Input-output relationship when business expands long run
Constant returns to scale
Constant returns to scale
% increase in inputs = % increase in outputs
Increasing returns to scale
Increasing returns to scale
Input increase → larger % output increase
Decreasing returns to scale
Decreasing returns to scale
Input increase → smaller % output increase
Economies of scale
Economies of scale
Cost advantages from increasing production scale
Factors creating economies of scale
Factors creating economies of scale
Modern tech, better methods, organisation, bulk buying