Laffer Curve: What it is, Diagram & Criticisms
The Laffer Curve demonstrates that at both 0 and 100 percent taxation, government revenues are equal to zero.
Microeconomics
The brand of economics that looks at the behaviour of individuals and businesses. In other words, it examines how consumers and businesses react to changes in variables. For example, how do consumers react to price changes and how does quality affect this decision making.
Dependent and Independent Variables in Economics
An independent variable is one which is changed by the researcher in order to find out what impact it has on the dependent variable – which is kept constant.
Microeconomics Definition
Microeconomics is a study within economics that looks specifically at the behavior of individuals and firms. When considering limited resources, microeconomics looks at how individuals and firms overcome such restrictions and how this influences economic decisions.
Sunk Cost: What it is, Examples & Fallacy
A sunk cost is a payment that has been made but cannot now be recovered.
Variable Cost: Definition, Formula & Examples
We can define a variable cost as a cost that changes based on the output of the business.
Marginal Cost: How to Calculate, Formula & Examples
Marginal cost refers to the additional amount it costs to produce one extra good.
Factors of Production: Definition, 4 Factors & Examples
The factors of production are all the various elements that are required to come together to create a good.
Production Function: How to Calculate with Formula & Example
The production function calculates how many inputs you need to create X number of outputs.
Accounting vs Economic Profit
The main difference between accounting and economic profit is that economic profit includes implicit costs. Whilst accounting profits include the raw costs of doing business, economic profit includes the opportunity cost of employing those resources for an alternative use.
Income Effect: What it is, Examples & Graph
Where changes in income, affect the demand for goods. As incomes rise, demand tends to rise. As incomes fall, demand tends to fall.
