Total Revenue: The total amount of money a firm receives from
selling goods and services. [P * Q = TR]
Fixed
Cost: A cost that does
not change no matter how much is produced. [Ex; Rent, Mortgage, Insurance,
Salaries]
Variable
Cost: A cost that rises
or falls depending upon how much is being produced.
Marginal
Cost: The cost of
producing one or more unit of a good.
In addition to these terms, it is also important to remember that marginal cost and marginal revenue are different. Marginal cost is the cost of producing, and marginal revenue is what you make.
ReplyDeleteNew TR- Old TR= Marginal Revenue.