AP Economics – 10/16/19
I. Bellwork
- Page 551 Free Response #2
II. Objectives
- Describe the various types of cost a firm faces: variable, fixed, and total costs
- Explain how a firm’s costs generate marginal cost curves and average cost curves
- Interpret and explain graphic models representing costs
III. Discussion: Firm Cost Module 55 – pgs 552-562
A. How Nintendo loses money on every Wii U
B. Concepts
- TC = FC + VC
- MC = Chg TC / ChgQ
- ATC = TotalCost / Quantity of Output
- AFC = Fixed Cost ./ Quantity of Output
- AVC = Variable Cost / Quantity of Output
- Spreading Effect-p. 558
- Diminishing Returns Effect-p. 558
C. Videos:
- Costs of Production- Microeconomics 3.3 (Part 1)
- Cost Curves- Microeconomics 3.3 (Part 2)
- Short-Run Cost Curves (Part 3)- Micro Topic 3.2
IV. Classork
3.2 Cost of Production Practice
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