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Costs and Labor (2 pages)

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Costs and Labor

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This lecture focused on the short run production costs. We talked about marginal product of labor and average product of labor and learned how to calculate those. We also briefly went over what the graphs of those will look like.

Lecture number:
10
Pages:
2
Type:
Lecture Note
School:
The University of Oklahoma
Course:
Econ 1123 - Princ. of Econ-Micro
Edition:
1
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Unformatted text preview:

ECON 1123 1st Edition Lecture10 Outline From Previous Lecture (Lecture 10) Class was canceled so no outline Outline Lecture 11 I. Outputs II. Costs Lecture 10 Notes I. Outputs The short run- A time frame in which the quantity of at least one factor of production is fixed. (some factors used by the firm are fixed in quantity. i.e. technology, buildings, capital.) in the short run. You canâ€™t just build a new factory in a week, or even a month. Note: other factors used by the firm vary with output (such as labor, raw materials, energy.) In the short run, to increase output the firm must increase the quantity of variable factors it uses. Fixed Factors- Cannot be changed in the short run Variable Factors- Production can be varied at any point The Long Run- A time frame in which the quantities of all factors of production can be varied. This means that the firm can change its plant size, as well as the quantity of all its other factors in the long run. Note: long run decisions are not easily reversed II. Costs Looking at production and costs in the short run: Total product (x), which is the maximum output that a given quantity of labor can produce Marginal Product of Labor- the income in total product that results from a one- unit increase in the quantity of labor employed with all other inputs remaining the same MPL= Change in X/ Change in labor Average Product of Labor (APL) which equals total product divided by the quantity of labor employed. APL= stuff/ labor (number of workers) These notes represent a detailed interpretation of the professorâ€™s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.

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