SUPPLY

==Law of Supply:== as the price rises, the quantity supplied rises OR as the price falls, quantity supplied falls

@@Law of Demand@@: price and quantity demanded share an inverse relationship

3 fixed costs: Rent, insurance, loan payments

%%3 variable costs%%: hourly labor, raw materials, bonuses

****

==Total Cost==: FC+VC

@@Marginal Cost@@: current TC—last TC

Average Total Cost: TC / TP

%%Total Revenue%%: MR x TP

^^Marginal Revenue^^: PRICE of a widget

==Profit==: TR—TC

@@Profit Maximizing Formula@@: MC=MR

Break-Even Point: TC=TR

%%“In the Red”%%: losing profits- cash flow negative

^^“In the Black”^^: making profit- cash flow positive

==Short run==- temporary

@@Long run@@- recession or depression

Subsidy- tax credit/tax break

%%Find Marginal product%%: How many more of a product are you making each time?

^^7 determinants of supply^^: change in production cost, change in productivity, improvements in technology, changes in taxes or subsidies, cost in availability of raw materials, change in producer population, producer expectations

==Shift right==: increase in supply

@@Shift left@@: decrease in supply

****When the price of a good changes: the SUPPLY changes

%%Supply is elastic for%%: shoes, groceries

^^Supply is inelastic for^^: luxury/classic cars, construction sites

==Characteristic of a good with inelastic supply==: difficult or impossible to bring to the market quickly

@@A change in the price of a good@@: Shift along the curve