Flashcards
type of cost
Cards in this deck (9)
- 1Opportunity costNext best alternative foregone
- 2Social costIn a market failure/ externalities
- 3Explicit costCosts which a firm a contracted to pay
E.g wages /utility bills - 4Implicit costCost which occurs when a firm owns some of the resources it is using.
- 5Fixed costCost which does not change as output change .
- 6Variables costCost which change as output changes
E.g salaries of labour, petrol expenses,utilities,etc - 7Total costThe cost of all the resources necessary to produce any particular level of output.
It normally rises with output. - 8Marginal costCosts of producing one more or less unit of a commodity
- 9Average costIs the total cost divided by the number of units of the commodity produced.