Econ. Dec. 11 by Peter Melkonian

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Econ. Dec. 11

Published on Nov 27, 2015

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PRESENTATION OUTLINE

Production of goods

mr. melkonian

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comic on page 140

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function of the economy

produce goods/services to satisfy wants and needs

Untitled Slide

What to produce?
How to produce it?
For whom will we produce?

command economy

economy directed by central governing body

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remember...

canada is a marke economy

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free competition

is the driving force for us

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tax

if it's too high.... or too low, people get cheesed

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real gross domestic product

measure of total value of goods and services produced by the economy

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10.

takes into account influence of price change

inflation

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11.

gdp also includes

stuff the government makes (government expenditure)

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12.

govt. produces 20%

wide variety of firms produce the rest

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13.

firms want profit

independent of producing goods/services

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14.

origins of firms

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15.

things changed a bit

16.

people learned to grow food...

one thing led to another

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17.

profit of a firm

excess revenue over cost

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18.

profit is important for a few reasons...

money, motivation, comparison to competitors

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19.

assess how their goods are doing

make changes when required

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20.

high profit

dividends to shareholders

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21.

theory of the firm

assume that producers are all profit maximizers

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22.

invisbile hand

self-regulation of the economy, interest in profit by firms

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23.

total revenue

money a firm makes form sales

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24.

factors influencing revenue

price you charge and how much of it people buy at that price

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25.

profit=(price X Q sold) - costs

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26.

higher prices of products...

not necessarily more profit. maybe higher production cost?discourage sales?

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27.

total cost

money spent to produce good/service. suppliers, land lords, hydro etc.

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28.

fixed cost

remain the same at all levels of output

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29.

variable cost

labour, raw material - as production rises...

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30.

profit =(price x q sold) - (fixed +variable cost)