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  • Welcome Video Of My Students Of Economics Class



    My Dear Students,

    Teachers have three loves: 

    love of learning, 

    love of learners,

     and the love of bringing the first two loves together.

    I am excited to meet you and hope we will have a wonderful journey.

    But remember one thing:

     

    “There are no shortcuts to any place worth going."


    INTRODUCTION:


    Economics is the social science of studying the production, distribution and consumption of goods and services and It is a complex social science that spans from mathematics to psychology. At its most basic, however, economics considers how a society provides for its needs. Its most basic need is survival; which requires food, clothing and shelter. Once those are covered, it can then look at more sophisticated commodities such as services, personal transport, entertainment, the list goes on. Today, this social science known as "Economics" tends to refer only to the type of economic thought which political economists refer to as Neoclassical Economics. It developed in the 18th century based on the idea that Economics can be analyzed mathematically and scientifically. Economics is about a different way of thinking and looking at the world. We can apply the economic way of thinking to almost everything, not just to business or finance and such.

     

     COURSE INSTRUCTOR:

    Munmun Shabnam Bipasha

    Assistant Professor
     Business Administration
     Email: bipasha@daffodilvarsity.edu.bd
    Phone:01922638216
     Daffodil International University 


     COURSE NAME 

     Economics 

    Counselling Hour 

    My student can call me a any time if they need me.
    But my preferable counselling time is from 9am to 9 pm any day.



      

  • QUIZ

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  • LECTURE 1

    Content 

    Economics 


    Objective

    Basic concept of Microeconomics and macroeconomics
    a. Students will be able to identify and explain economic concepts and theories related to the behavior of economic agents, markets, industry and firm structures, legal institutions, social norms, and government policies.
    b. Students will be able to integrate theoretical knowledge with quantitative and qualitative evidence in order to explain past economic events and to formulate predictions on future ones.
    c. Students will be able to evaluate the consequences of economic activities and institutions for individual and social welfare.
    a. Students will be able to identify the determinants of various macroeconomic aggregates such as output, unemployment, inflation, productivity and the major challenges associated with the measurement of these aggregates.
    b. Students will be able to discuss the linkages between financial markets and the real economy, and how these linkages influence the impact of economic policies over differing time horizons.
    c. Students will be able to describe the main macroeconomic theories of short term fluctuations and long term growth in the economy.
    d. Students will be able to critically evaluate the consequences of basic macroeconomic policy options under differing economic conditions within a business cycle.
    e. Students will be able to identify the basic features of alternative representations of human behavior in economics.


    Outcome 

    The fundamental concept which is responsible for economic growth as we know it is specialization of labor. If an entity is really efficient in producing a commodity (output to input ratio is high), it has an advantage over another entity which is not that efficient in producing the commodity under consideration.


  • Lecture2



    Content

    Economic System 

    Objective


    • An economic system is the decision-making structure of a nation’s economy, characterized by the entities and policies that shape it.
    • An economic system may involve production, allocation of economic inputs, distribution of economic outputs, firms, and the government to answer the economic problem of resource allocation.
    • There are two general subtypes of economic systems: free market systems and planned systems.
    • A country may have some elements of both systems, and this type of economy is known as a mixed economy.

    Outcome: Economic Systems

     

    Differentiate between economic systems and discuss theoretical views of economics.

    In this section, you’ll examine the basics of economies, which refer to the social institution through which a society’s resources (goods and services) are managed. The Agricultural Revolution led to development of the first economies that were based on trading goods. Mechanization of the manufacturing process led to the Industrial Revolution and gave rise to two major competing economic systems. Under capitalism, private owners invest their capital and that of others to produce goods and services they can sell in an open market. Prices and wages are set by supply and demand and competition. Under socialism, the means of production is commonly owned, and the economy is controlled centrally by government. Several countries’ economies exhibit a mix of both systems. Convergence theory seeks to explain the correlation between a country’s level of development and changes in its economic structure.

    What You’ll Learn To Do:

    • Understand types of economic systems and their historical development
    • Describe capitalism and socialism both in theory and in practice
    • Discuss how functionalists, conflict theorists, and symbolic interventionists view the economy

  • Lecture 3


    Content 

    Demand 

     

    Objectives of Demand Analysis:

    According to Dean, demand analysis has four managerial purposes:

    (1) Forecasting sales,

    (2) Ma­nipulating demand,

    (3) Appraising salesmen’s performance for setting their sales quotas, and

     (4) Watching the trend of the company’s competi­tive position.

    Of these the first two are most im­portant and the last two are ancillary to the main economic problem of planning for profit.

    i. Forecasting Demand:

    Forecasting refers to predicting the future level of sales on the basis of current and past trends. This is perhaps the most important use of demand stud­ies. True, sales forecast is the foundation for plan­ning all phases of the company’s operations. There­fore, purchasing and capital budget (expenditure) programmes are all based on the sales forecast.

    ii. Manipulating Demand:

    Sales forecasting is most passive. Very few com­panies take full advantage of it as a technique for formulating business plans and policies. However, “management must recognize the degree to which sales are a result only of the external economic environment but also of the action of the company itself.

     

    ADVERTISEMENTS:

    Sales volumes do differ, “depending upon how much money is spent on advertising, what price policy is adopted, what product improve­ments are made, how accurately salesmen and sales efforts are matched with potential sales in the various territories, and so forth”.

    Often advertising is intended to change consumer tastes in a manner favourable to the advertiser’s product. The efforts of so-called ‘hidden persuaders’ are directed to ma­nipulate people’s ‘true’ wants. Thus sales forecasts should be used for estimating the consequences of other plans for adjusting prices, promotion and/or products.

     

    Importance of Demand Analysis:

    A business manager must have a background knowledge of demand because all other business de­cisions are largely based on it. For example, the amount of money to be spent on advertising and sales promotion, the number of sales-persons to be hired (or employed), the optimum size of the plant to be set up, and a host of other strategic business decisions largely depend on the level of demand.

    Why should a business firm invest time, effort and money to produce colour TV sets in a poor country like Chad or Burma, unless there is sufficient de­mand for it? A firm must be able to describe the fac­tors that cause households, governments or business firms to desire a particular product like a type­writer. It is in this context that an understanding of the theory of demand is really helpful to the practicing manager.

    Demand theory is undoubtedly one of the man­ager’s essential tools in business planning both short run and long run. The objective of corporate planning is to identify new areas of investment.

    In a dynamic world characterised by changes in tastes and preferences of buyers, technological change, migration of people from rural to urban areas, and so on, it is of paramount importance for the business manager to take into account prospective growth of demand in various market areas before taking any decision on new plant location (i.e., the place of birth decision of a business firm).

    If demand is ex­pected to be stable, big sized plant may have to be set up. However, if demand is expected to fluctu­ate, flexible plants (possibly with lower average costs at the most likely rate of output) may be de­sirable.

    A huge amount of capital may be required to carry inventories of finished goods. If demand is really responsive to advertising, there may be a strong rationale for heavy outlay on market devel­opment and sales promotion.

    Outcome: Demand

    What you’ll learn to do: explain the determinants of demand

    Imagine that the price of Ben & Jerry’s ice cream decreases by 25 percent during the next summer. What do you think will happen to the amount of Ben & Jerry’s ice cream that people will want to buy? Clearly, the demand for ice cream will increase. By the same token, if the price of the ice cream were to rise by 25 percent, then the demand for the ice cream would fall. In this section, you will examine the law of demand and see why this simple concept is essential to understanding economics.

    The specific things you’ll learn in this section include the following:

    • Explain the law of demand
    • Explain a demand curve
    • Create a demand curve using a data set
    • Describe the differences between changes in demand and changes in the quantity demanded
    • Explain the impact of factors that change demand

    Learning Activities

    The learning activities for this section include the following:

    • Reading: What Is Demand?
    • Video: Change in Demand vs. Quantity Demanded
    • Reading: Factors Affecting Demand
    • Worked Example: Shift in Demand
    • Reading: Summary of Factors That Change Demand
    • Simulation: Demand for Food Trucks

  • Lecture 4

    Content 

    Supply


    Objective


    • explain that the interaction of supply and demand determines price
    • define market equilibrium
    • compare a market in equilibrium with a market in disequilibrium
    • describe what happens to price when there is a surplus or shortage in the market
    • demonstrate how changes in the determinants of supply and demand affect the equilibrium price and quantity of a good or service
    • explain that a market reacts to changes in supply and demand by moving to a new equilibrium
    • use graphs to illustrate shifts in supply and demand and changes in equilibrium price and quantity


    Outcome 


    What makes prices rise and fall? Do candymakers have a meeting and decide how much they will charge for their candy? Or does the government command candymakers to lower their prices? Who actually determines the prices of the stuff we buy? It might seem like mysterious forces are at work, but that's not the case.

    Prices for most goods and services are determined in markets by what economists call supply and demand. This course will use a fictitious chocolate market to help you better understand how supply and demand work together to determine prices.


  • Lecture 5

    Content 

    Equilibrium


    Objective

     Learning Objectives: What is market equilibrium? How do demand and supply interact to clear the market? What happens if there is a change in demand or supply or both? What is consumer surplus? What is producer surplus?

     1.Demand and Supply Demand for a good gives us the willingness of all the consumers in the market to pay different prices for different quantities of the good being demanded. Supply of a good gives us the willingness of all the producers in the market to supply different quantities of the good at different prices. Demand and supply jointly determine the competitive market equilibrium.

    2.Market Equilibrium If the quantity demanded of a good in the market is the same as the quantity supplied of the good in that market, then the market for the good is in equilibrium at that quantity and price level. If price of the good is higher than the equilibrium market price, then there will be excess supply of the good  Downward pressure on price  Price will decrease. If price of the good is lower than the equilibrium market price, then there will be excess demand for the good  Upward pressure on price  Price will increase. Example: Burger King Ending 15-Cent Nugget Deal as Supplies Wane

    3.Change in Demand If there is a rise in the demand for a good, ceteris paribus, then both the equilibrium market price and equilibrium market quantity will rise, and vice versa. Example: Bah Humbug: Spirit Airlines Ups Baggage Fee $2 During Holiday Travel Season Example: Delhi Noida Direct Flyway, 2006

    4.Change in Supply If there is a rise in the supply of a good, ceteris paribus, then the equilibrium market price will fall and equilibrium market quantity will rise, and vice versa. Example: The Petroleum Market: 1970-2001 Example: Bob Marley's Ubiquitous Legend Finally Hits The Top 10

    5. Change in Demand and Supply What happens if both demand and supply change? Example: No Pecan Pie? Thank China, Rain and Pigs Example: Resolving China's Power Shortage, 2004 Example: Amazon to Publishers: Set Your Own E-Book Prices! Amazon to Customers: Not Our Fault!

    6. Consumer Surplus Consumer surplus is the extra value from a good that consumers get while just paying the competitive market price.

    7. Producer Surplus Producer surplus is the extra revenue that producers receive in excess of what’s necessary to induce them to produce the good while selling it at the competitive market price.

    8. Price Ceiling Government mandated maximum price that can be legally charged for a good. Example: Venezuela hopes to wipe out toilet paper shortage by importing 50m rolls Example: Vodka prices: Putin calls for cap amid economic crisis

    9. Price Floor Government mandated minimum price to be legally charged for a good. Example: The Birth Of The Minimum Wage In America


    Outcome: Equilibrium

    What you’ll learn to do: explain and graphically illustrate market equilibrium, surplus, and shortage

    In this section, you’ll learn how supply and demand interact to determine the price in a market.

    The specific things you’ll learn in this section include the following:

    • Define and explain equilibrium price and quantity
    • Create a graph that illustrates equilibrium price and quantity
    • Define and explain surpluses and shortages
    • Create a graph that illustrates surpluses and shortages
    • Describe how disequilibrium can create surpluses and shortages; explain how markets eliminate them

    Learning Activities

    The learning activities for this section include the following:


  • Lecture 6

    Content 
    Elasticity
    Objective
    We have reconciled and generalized earlier comparisons of input demand elasticities under different objective functions of the firm. In general little can be said of the relative magnitudes of the elasticities under different objectives, since different goals usually imply different levels of production and input demand. With some simplifying assumptions about the technology we can conclude that a profit-constrained, utility-maximizing firm tends to have higher input demand elasticities than a profit-maximizing firm facing the same cost and demand functions. This tendency is reinforced by a high profit requirement, decreasing returns to scale and slowly falling demand elasticity for the output.
    Outcome 

    What you’ll learn to do: explain the concept of elasticity

    Elasticity is an economics concept that measures the responsiveness of one variable to changes in another variable. For example, if you raise the price of your product, how will that affect your sales numbers? The variables in this question are price and sales numbers. Elasticity explains how much one variable, say sales numbers, will change in response to another variable, like the price of the product.

    Mastering this concept resembles learning to ride a bike: It’s tough at first, but when you get it, you won’t forget. A rookie mistake is learning the calculations of elasticity but failing to grasp the idea. Make sure you don’t do this! First take time to understand the concepts—then the calculations can be used simply to explain them in a numerical way.

    The specific things you’ll learn in this section include the following:

    Learning Activities

    The learning activities for this section include the following:


  • Lecture 7

    Content

    UTILITY

    Objective

    Utility is value. Objective utility is nonrelative value. It may attach to a good for a person without being relative to the person’s attitudes. For example, a baby’s health has high objective utility although the baby is too young to value health.

    Utilitarian moral theorists such as Jeremy Bentham ([1789] 1996) and John Stuart Mill ([1861] 2006) formulated accounts of objective utility. According to Bentham it is pleasure, and according to Mill it is happiness. Some contemporary utilitarians such as Fred Feldman (1986) accommodate pluralism about values. They recognize nonhedonistic basic values such as justice.

    Objective utility contrasts with subjective utility. Subjective utility is a person’s rational strength of desire at any time. It varies from person to person because of differences in goals and information. John von Neumann and Oskar Morgenstern (1944) define subjective utility in terms of coherent preferences concerning gambles. Such preferences ground quantitative comparisons of a person’s attitudes toward the gambles’ possible outcomes

    Outcome

    Expected Utility Theory

    This is a theory which estimates the likely utility of an action – when there is uncertainty about the outcome. It suggests the rational choice is to choose an action with the highest expected utility.

    This theory notes that the utility of a money is not necessarily the same as the total value of money. This explains why people may take out insurance. The expected value from paying for insurance would be to lose out monetarily. But, the possibility of large-scale losses could lead to a serious decline in utility because of the diminishing marginal utility of wealth.


  • Lecture 8

    CONTENT

    MONOPOLY,OLIGOPOLY

    OBJECTIVES


    The main objectives of firms are:

    1. Profit maximisation
    2. Sales maximisation
    3. Increased market share/market dominance
    4. Social/environmental concerns
    5. Profit satisficing
    6. Co-operatives

    Sometimes there is an overlap of objectives. For example, seeking to increase market share, may lead to lower profits in the short-term, but enable profit maximisation in the long run.

    business-objectives


    Alternative aims of firms

    However, in the real world, firms may pursue other objectives apart from profit maximisation.

    1. Profit Satisficing

    profit-satisficing

    • In many firms, there is a separation of ownership and control. Those who own the company (shareholders) often do not get involved in the day to day running of the company.
    • This is a problem because although the owners may want to maximise profits, the managers have much less incentive to maximise profits because they do not get the same rewards, (share dividends)
    • Therefore managers may create a minimum level of profit to keep the shareholders happy, but then maximise other objectives, such as enjoying work, getting on with other workers. (e.g. not sacking them) This is the problem of separation between owners and managers.
    • This ‘principal-agent‘ problem can be overcome, to some extent, by giving managers share options and performance related pay although in some industries it is difficult to measure performance.
    • More on profit-satisficing.

    2. Sales maximisation

    Firms often seek to increase their market share – even if it means less profit. This could occur for various reasons:

    • Increased market share increases monopoly power and may enable the firm to put up prices and make more profit in the long run.
    • Managers prefer to work for bigger companies as it leads to greater prestige and higher salaries.
    • Increasing market share may force rivals out of business. E.g. the growth of supermarkets have lead to the demise of many local shops. Some firms may actually engage in predatory pricing which involves making a loss to force a rival out of business.

    3. Growth maximisation

    This is similar to sales maximisation and may involve mergers and takeovers. With this objective, the firm may be willing to make lower levels of profit in order to increase in size and gain more market share. More market share increases its monopoly power and ability to be a price setter.

    4. Long run profit maximisation

    In some cases, firms may sacrifice profits in the short term to increase profits in the long run. For example, by investing heavily in new capacity, firms may make a loss in the short run but enable higher profits in the future.

    5. Social/environmental concerns

    A firm may incur extra expense to choose products which don’t harm the environment or products not tested on animals. Alternatively, firms may be concerned about local community / charitable concerns.

    • Some firms may adopt social/environmental concerns as part of their branding. This can ultimately help profitability as the brand becomes more attractive to consumers.
    • Some firms may adopt social/environmental concerns on principal alone – even if it does little to improve sales/brand image.

    6. Co-operatives

    Co-operatives may have completely different objectives to a typical PLC. A co-operative is run to maximise the welfare of all stakeholders – especially workers. Any profit the co-operative makes will be shared amongst all members.

    Diagram showing different objectives of firms

    firm-objectives

    • Q1 = Profit maximisation (MR=MC)
    • Q2 = Revenue Maximisation (MR=0)
    • Q3 = Marginal cost pricing (P=MC) – allocative efficiency
    • Q4 = Sales maximisation – maximum sales while still making normal profit (AR=ATC)

     Learning Objectives ,OLIGOPOLY • After studying this chapter you will be able to: • Explain how strategic interaction shape optimal decisions in oligopoly market • Identify the conditions of oligopoly and explain how different types of oligopoly makes price decisions, output decisions, and firm profits • Identify the conditions for competitive market and explain market power and sustainability of long run profits


    OUTCOMES

    oligopoly


    What is monopoly outcome?
    A monopoly occurs when there is a single seller, called the monopolist, in a market. A monopolist produces the quantity such that marginal revenue equals marginal cost. This is a lower level of output than the competitive market outcome

  • Lecture 9

    CONTANT

    GROSS DOMESTIC PRODUCT/GROSS NATIONAL PRODUCT


    Objectives

    The overall purpose of this learning pathway is to take a closer look at GDP and definitions of economic growth, value and savings. Your goal is to:

    • define nominal gross domestic product and real gross domestic product;
    • compare and contrast as well as discuss various measures of output and income;
    • distinguish between real and nominal values;
    • analyze the problems associated with using GDP as a measure of well-being;
    • identify the components of the expenditure and the income approaches to the measurement of GDP;
    • explain how consumer income relates to spending and saving;
    • describe the consumption and savings functions and the terms attached to their slopes;
    • define automatic stabilizers, and explain changes in government spending and taxing during a macroeconomic recession and expansion;
    • describe how savings and investment contribute to economic growth; and
    • define economic growth in terms of changes in the production possibilities curve and in real gross domestic product.

    OUTCOME:

     As much as economists like to use GDP as a measure of output, or even as a measure of a country’s well being, GDP has some limitations when trying to answer those questions. GDP leaves out some production in an economy, such as the squash your mom might grow in the backyard, or other non-marketed goods. Even though GDP is frequently used to capture the wellbeing of a society, it was never intended to do that, and as a result it leaves out important aspects of well-being like pollution or even happiness.

    Key terms

    Key Termsdefinition
    quality of life(sometimes called “well-being”) the standard of health, happiness, security, and material comfort of an individual, a group of people, or a nation
    non-market transactionseconomic activity that takes place in the informal sector (from babysitting, to lawn mowing, to illegal drug sales), sometimes called the gray market or the black market economy; non-market transactions are not recorded, taxed, or officially monitored by the government. Because of this, the output and income generated is not included in the calculation of a nation’s GDP.
    income inequalitywhen a disproportionate share of a nation’s income is earned by a small minority of households; for example, when the top 10, percent of households earn 80, percent of the total income in a country, there is a high degree of income inequality; GDP does not account for income distribution in any way.
    sustainabilitythe ability of a system to endure indefinitely into the future; an increase in GDP will only be sustainable as long as it does not deplete natural resources too rapidly nor exploit the environment in a way that diminishes the quality of life of the nation’s households over time.
    economic badsany outcome from economic activity that creates negative value for society, such as air pollution from cars that harms human health and the environment; unsustainable economic growth may diminish the quality of life of a nation’s people.
    real GDP per capitathe real gross domestic product of a nation, divided by the nation’s population; this measure is an indication of the average income of a nation’s people
    depreciation of capitalthe decrease in the value of a nation’s capital stock over time; GDP accounts for investment in new capital but does not subtract the lost value of depreciated capital. Because of this, GDP may overstate the amount of economic activity in nations with rapidly depreciating capital stocks.
    Human Development Index (HDI)a composite measure of nation’s social and economic development developed by the United Nations that includes measures of health, wealth, and education
    Genuine Progress Indicator (GPI)a measure of a nation’s quality of life that includes the income and output measured by gross domestic product. This measure subtracts out the costs of negative effects related to economic growth such as crime, environmental degradation, resource depletion, and the costs of climate change. GPI nets the positives and negatives of economic activity to provide a more accurate measure of a nation’s quality of life than GDP alone.
    Happy Planet Index (HPI)a measure of a nation’s quality of life that includes survey results on happiness, life expectancy at birth, the degree of inequality across society, and the ecological footprint



  • Lecture 11

    SOME IMPORTANT TOPICS OF ECONOMICS.


    MACRO ECONOMIC GOALS AND OBJECTIVES,

     INFLATION,DEFLATION,UNEMPLOYMENT,

    Philip's Curve

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      MACROECONOMIC GOALS:


      Full Employment

      Full employment is achieved when all available resources (labor, capital,land, and entrepreneurship) are used to produce goods and services. 

      Stability

      Stability is achieved by avoiding or limiting fluctuations in production, employment, and prices. 

      Economic Growth

      Economic growth is achieved by increasing the economy's ability to produce goods and services. 


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      Inflation and Deflation

       Inflation is an increase in the price of a basket of goods and services that is representative of the economy as a whole.

      Deflation is a decrease in the general price level of goods and services. Deflation occurs when the annual inflation rate falls below zero percent (a negative inflation rate), resulting in an increase in the real value of money – allowing one to buy more goods with the same amount of money. This should not be confused with disinflation, a slow-down in the inflation rate (i.e. when inflation decreases, but still remains positive). As inflation reduces the real value of money over time, conversely, deflation increases the real value of money – the functional currency (and monetary unit of account) in a national or regional economy.

      What is 'Unemployment'

       Unemployment is a phenomenon that occurs when a person who is actively searching for employment is unable to find work. 

      Frictional Unemployment

      Frictional unemployment arises when a person is in-between jobs. 

      Cyclical Unemployment

      Cyclical unemployment comes around due to the business cycle itself. 

      Structural Unemployment

      Structural unemployment comes about through technological advances, when people lose their jobs because their skills are outdated.

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      OUTCOME AND OBJECTIVE

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  • Lecture 12

    CONTENT-  COST
    OBJECTIVE:

    Types of Costs
    A list and definition of different types of economic costs.
    costs
    Fixed Costs (FC) The costs which don’t vary with changing output. Fixed costs might include the cost of building a factory, insurance and legal bills. Even if your output changes or you don’t produce anything, your fixed costs stay the same. In the above example, fixed costs are always £1,000.
    Variable Costs (VC) Costs which depend on the output produced. For example, if you produce more cars, you have to use more raw materials such as metal. This is a variable cost.
    Semi-Variable Cost. Labour might be a semi-variable cost. If you produce more cars, you need to employ more workers; this is a variable cost. However, even if you didn’t produce any cars, you may still need some workers to look after an empty factory.
    Total Costs (TC)  = Fixed + Variable Costs
    Marginal Costs – Marginal cost is the cost of producing an extra unit. If the total cost of 3 units is 1550, and the total cost of 4 units is 1900. The marginal cost of the 4th unit is 350.
    Opportunity Cost – Opportunity cost is the next best alternative foregone. If you invest £1million in developing a cure for pancreatic cancer, the opportunity cost is that you can’t use that money to invest in developing a cure for skin cancer.
    Economic Cost. Economic cost includes both the actual direct costs (accounting costs) plus the opportunity cost. For example, if you take time off work to a training scheme. You may lose a weeks pay of £350, plus also have to pay the direct cost of £200. Thus the total economic cost = £550.
    Accounting Costs – this is the monetary outlay for producing a certain good. Accounting costs will include your variable and fixed costs you have to pay.
    Sunk Costs. These are costs that have been incurred and cannot be recouped. If you left the industry, you could not reclaim sunk costs. For example, if you spend money on advertising to enter an industry, you can never claim these costs back. If you buy a machine, you might be able to sell if you leave the industry. See: Sunk cost fallacy
    Avoidable Costs. Costs that can be avoided. If you stop producing cars, you don’t have to pay for extra raw materials and electricity. Sometimes known as an escapable cost.
    Explicit costs – these are costs that a firm directly pays for and can be seen on the accounting sheet. Explicit costs can be variable or fixed, just a clear amount.
    Implicit costs – these are opportunity costs, which do not necessarily appear on its balance sheet but affect the firm. For example, if a firm used its assets, like a printing press to print leaflets for a charity, it means that it loses out on revenue from producing commercial leaflets.
    Market Failure
    • Social Costs. This is the total cost to society. It will include the private costs plus also the external cost (cost incurred by a third party). May also be referred to as ‘True costs’
    • External Costs. This is the cost imposed on a third party. For example, if you smoke, some people may suffer from passive smoking. That is the external cost.
    • Private Costs. The costs you pay. e.g. the private cost of a packet of cigarettes is £6.10
    • Social Marginal Cost. The total cost to society of producing one extra unit. Social Marginal Cost (SMC) = Private marginal cost (PMC) + External marginal Cost (XMC)
    Diagram of Costs
    For full diagrams of costs see: Diagrams of cost curves
    Average Cost Curves

    cost-curves-mc-atc-avc

    • ATC (Average Total Cost) = Total Cost / quantity
    • AVC (Average Variable Cost) = Variable cost / quantity
    • MC = Marginal cost.
    • AFC (Average Fixed Cost) = Fixed cost / quantity

    Total costs

    fixed-variable-total-costsTotal cost (TC) = Variable cost (VC) + fixed costs (FC)

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      Your Learning/STUDENT FEEDBACK


      1)DO YOU UNDERSTAND TODAY'S LECTURE?

      2) IS IT INTERESTING TOPIC?

      3)IF YOU FACE ANY PROBLEM,CONTACT WITH ME.

  • ASSIGNMENT

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  • PRESENTATION

    Welcome to our PRESENTATION || Bangla Tutorial || PowerPoint on Make a GIF

    LAST DATE-5th June,2023 11.50pm

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      OLD SECTION

      Each student must write two links from your google drive(must access for anyone,no restriction)

      1. first one is for Video

      2,Second one id PDF link

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  • Topic 21

  • Topic 22