Production and Costs

10%-15% of AP Test

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Production functions: short and long runShort run costs and long run costs.

Marginal product and diminishing returns

Marginal product and marginal cost curves-where DMR occurs.

Short-run costs

Short run cost curves, variable inputs, and fixed costs.

Long-run costs and economies of scale

Cost minimizing input combination

Comparison of labor and capital for least costly combination.