Economics in terms of business how it affect factors consequences

1. BUSINESS
ECONOMICS
Submitted to :
udit sir
Submitted by:
Gaurav palariya

2. COST CONCEPT
It refers to amount
of expenditure
incurred in
production of
good and service C=F(Q)
F= Functional relationship
C=Cost of production
Q=Quantity of product

3. CLASSIFICATION OF COST
 Opportunity cost
 Marginal cost
 Average cost
 Fixed cost
 Variable cost
 Total cost
 Money cost
 Explicit cost
 Implicit cost

4. SHORT RUN COST
 The short run, in economics, expresses the concept that an
economy behaves differently depending on the length of time
it has to react to certain stimuli. The short run does not refer
to a specific duration of time but rather is unique to the firm,
industry or economic variable being studied. A key principle
guiding the concept of short run and long run is that in the
short run, firms face both variable and fixed costs, which
means that output, wages and prices do not have full
freedom to reach a new equilibrium

5. Short run cost are
accumulated in real time throughout
The production process. Fixed cost has no impact on
short run cost only variable cost and revenues affect
the short run production variable cost changes with
output

6. LONG RUN COST
A period of time in which all factors of production and
costs are variable. In the long run, firms are able to
adjust all costs, whereas in the short run firms are only
able to influence prices through adjustments made to
production levels. Additionally, whereas firms may be
a monopoly in the short-term they may expect
competition in the long-term.

7. The long run costs are costs that are incurred on fixed
assets like plant ,machinery , etc
The long run cost are accumulated when firm change
production
Level over time in response to expected economic
profit or losses.
In long run there are no fixed factor of production the
land labor capital goods and entrepreneurship all
vary to reach the long run cost of producing a good
or service

8. THE DIFFERENCE BETWEEN
THE LONG AND SHORT RUN COST IS
There are no fixed factor in long run ,there are
both fixed and variable factor in short run
in long run general price level and expectation
adjust fully to the state of the economy in short
run these variable do not always adjust due to
the condensed time period