26 terms

McNabb test ch. 7,8,9

variable cost
a cost that changes with the number of units of a good produced
total cost
fixed cost plus variable cost
average total cost
total cost divided by quantity of output
marginal cost
cost of producing an additional unit of a good
marginal revenue
revenue from selling an additional unit of a good
law of diminishing marginal returns
law that states that if additional units of one resource are added to another resource in fixed supply, eventually the additional output will decrease
three types of firms
sole proprietorships, partnerships, corporations
one firm, great deal control over price
few firms, stand. or diff. product, quite difficult barriers of entry
nader view
biz has ethical/social responsibilities
real wage =
money wage divided by CPI (consumer price index)
friedman view
one social responsibility = use resources to make best profit w/o deception/fraud
Samuel Gompers
active in AFL (american federation of labor)
price searcher
seller that can sell some of its output at various prices
price taker
seller that can sell all its output at the equilibrium price but can sell none at any other price
cartel agreement
an agreement that specifies how the firms that entered into the agreement will act in a coordinated way to reduce the competition among them
sherman antitrust act (1890)
prevents mergers
federal trade commission act (1914)
prohibits aggressive price-cutting acts
robinson-patman act (1936)
prevents suppliers from offering discounts to large businesses to prevent closing of small businesses
wheeler-lea act (1938)
empowered the federal trade commission (FTC) to deal with fraudulent acts by businesses
knights of labor (1869)
union group calling for higher wages and an 8-hour working day
american federation of labor (1886)
samuel gompers! lobbying for better pay and improved working conditions
the norris-laguardia and wagner acts
1932 and 1935; claimed workers should be free from interference, restraint, and coercion of employers; made it illegal for employers to interfere with employees' rights to organize a union
taft-hartley act
gave states the right to pass right-to-work laws
landrum-griffin act (1959)
policed internal affairs of labor unions