Unit 4: Business Production Behavior

What’s in This Chapter? This unit describes typical production behavior of businesses, and explains the difference between short-run and long-run production behavior. Businesses use different types of resources to produce...

Factors of Production The three types of factors of production (inputs) are: 1. Land. Land includes land and other natural, non-man-made materials, such as raw materials, energy sources, and trees. The payment for the use of...

Production Functions A production function is a relationship between inputs (factors of production) and outputs (products). It illustrates how many workers and machines it might take to produce, for example, 1 bushel of wheat, 2...

Total, Average, and Marginal Cost Calculations Once we know a firm’s production behavior, and we know what each factor of production costs, we can derive the firm’s total, average, and marginal costs. Below we have...

Examples of Government Price Controls In most countries around the world when it comes to factor prices, there is a significant degree of government interference. In the labor market, the establishment of a minimum wage usually...

Nominal and Real Interest Rates The interest rate is the price that people pay for borrowing money. It is also the price that businesses or people receive for lending money. The nominal interest rate is the interest rate that...

  Time limit: 0 Quiz-summary 0 of 10 questions completed Questions: 1 2 3 4 5 6 7 8 9 10 Information This is a ten question multiple-choice quiz covering the material in this Unit. I hope you do well! You have already...