Supply (week of january 21st)

• Total Revenue - the total amount of money a firm receives from selling goods and services 
• Total revenue (TR) = Price x Quantity

•  Fixed cost - a cost that doesn't change no matter how much is produced
• ex: salary, mortgage 
• Variable cost - a cost that rises/falls depending upon how much is produced.
• ex: water, phone services, electricity
•  Marginal costs - cost of producing one additional unit of a good

• Marginal revenue - additional income from selling one more unit of a good 
•  Marginal revenue = New TR - Old TR

 Supply Chart:

Equations:

• Marginal Cost (MC) = New Total Cost (TC) - Old TC
• Average Fixed Cost (AFC) = Total Fixed Cost (TFC) / Quantity
• Average Variable Cost (AVC) = Total Variable Cost (TVC) / Quantity
• Average Total Cost (ATC) = TC / Quantity OR AFC - AVC