Hiring ________ raises the overall product by decreasing amounts, thus the marginal product falls after three workers.
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average cost
When a company achieves economies of scale, its long- run ________ lowers as output grows.
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lower average cost
When productivity is low, the smaller kitchen produces meals at a(n) ________ than McDonald's.
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Economic profit
________ is defined as total revenue minus all expenses, both implicit and explicit; ________ considers the opportunity cost of all resources utilized in production.
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Explicit cost
opportunity cost of resources employed by a firm that takes the form of cash payments
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Implicit cost
firm’s opportunity cost of using its own resources or those provided by its owners without a corresponding cash payment
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Average variable cost
Variable cost is divided by output
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Average total cost
total cost divided by output
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Economies of scale
Forces that reduce a firm’s average cost as the scale o operation increases in the long run
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