ch 7/8 econ
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Created by:
xzKellyxz8 on December 10, 2009
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27 terms
Terms | Definitions |
|---|---|
 Cartel | Indep. business organizations formed to regulate production, pricing, and marketing of goods |
| Monopolistic Competition | All firms produce similar products |
| Monopoly | Only one seller |
| Oligopoly | Their are few sellers |
| Perfect competition | all things are equal |
| Sole Proprietorship | business owned by individual |
| Corporation | a legal thing that can conduct business in the same way a person would |
| Partnership | business owned by 2 or more co-workers |
| cost | a price |
| Marginal Cost | The cost to produce one more unit Avrg. (Change in TC/ change in Q) |
| Marginal Revenue | The extra money earned by producing one more unit |
| Fixed cost | Cost that stay the same no matter how many units are produced (rent) Avrg. (FC/Q) |
| Variable cost | Cost that change w/ number of units made (labor) Avrg. (VC/Q) |
| Total Cost | All cost combine Avrg. (TC/Q) |
| 3 typs of business firms | Sole proprietorships, partnerships, and corporations |
| Advantages of sole prop. | Make your own decisions and only taxed once |
| Disadvantages of Sole prop. | limited ability to raise funs and unlimited liability |
| Liability | you can only lose what you put in |
| Unlimited Liability | an investment where you can lose unlimited amount of money |
| Advantages of partnership | only taxed once and people put their talents together to make it better |
| Disadvantages of Partnership | Unlimited liability and one partner might inflict all debts |
| Advantages of corporations | not personally responsible for debts and cont. to exist if someone dies |
| Disadvantages of Corporations | double taxation and it's complicated to set up |
| anitrust laws | restricts free trading and competition between business |
| Franchise | contract made so someone can use a businesses name and sell their goods |
| Franchiser | the person who allows people to own the building and use companies name |
| Franchisee | the person who gets the franchise |
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