Chapter 7 The Cost of Production
Chapter 7 The Cost of Production
Topics to be Discussed a Measuring Cost: Which Costs Matter? ■ Cost in the short rur a Cost in the Long Run a Long-Run Versus Short-Run Cost Curves Chapter 7 Slide 2
Chapter 7 Slide 2 Topics to be Discussed ◼ Measuring Cost: Which Costs Matter? ◼ Cost in the Short Run ◼ Cost in the Long Run ◼ Long-Run Versus Short-Run Cost Curves
Topics to be Discussed a Production with TWo Outputs-- Economies of Scope Dynamic Changes in Costs--The Learning curve a Estimating and Predicting Cost Chapter 7 Slide 3
Chapter 7 Slide 3 Topics to be Discussed ◼ Production with Two Outputs-- Economies of Scope ◼ Dynamic Changes in Costs--The Learning Curve ◼ Estimating and Predicting Cost
Introduction a The production technology measures the relationship between input and output a Given the production technology, managers must choose how to produce Chapter 7 Slide 4
Chapter 7 Slide 4 Introduction ◼ The production technology measures the relationship between input and output. ◼ Given the production technology, managers must choose how to produce
Introduction a To determine the optimal level of output and the input combinations, we must convert from the unit measurements of the production technology to dollar measurements or costs Chapter 7 Slide 5
Chapter 7 Slide 5 Introduction ◼ To determine the optimal level of output and the input combinations, we must convert from the unit measurements of the production technology to dollar measurements or costs