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ASISTENSI PE1

30 Oktober 2007

Saran dan Kritik 
          

Kalo ada pertanyaan yang aneh gak usah dijawab sekalian soalnya bikin bingung. (terlalu baik kalo ngejawab jd pertanyaan nggak penting itu tetep dijawab dan bikin agak bingung). Slidenya pake bahasa indonesia ajah Perbanyak contoh soal dan pembahasannya (memberikan contoh soal UTS dan UAS) mahasiswa mengerjakan terlebih dahulu soal-soalnya . Ada hiburannya musik (humornya ditambah supaya nggak ngantuk) Terlalu cepet ngejelasinnya (kak lebih pelan-pelan ngejelasinnya yah, saya ngertinya lama..hehe) Kakak jangan suka bingung sendiri ya kak (kebanyakan yang dipikirin tidak perlu memikirkan asumsi yang merestriksi kakak berstatement ) jawabanya tergantung mulu Lebih santai tetapi serius ( jangan terlalu serius). Jangan terlalu kaku Jangan terlalu lama efisiensi waktu Intonasi nadanya diperjelas Belajar dari hal-hal yang belum dimengerti Lebih sistematis Ada sesi pertanyaan ketika asistensi akan berakhir

 Cost of production .

Cost associated with opportunities that are foregone when a firm s resources are not put to their highest-value use. including opportunity cost Opportunity cost.Measuring Cost: Which Costs Matter? Economic Cost vs. . Accounting Cost  Accounting Cost Actual expenses plus depreciation charges for capital equipment  Economic Cost Cost to a firm of utilizing economic resources in production.

‚ Explicit costs are input costs that require a direct outlay of money by the firm. ‚ Implicit costs are input costs that do not require an outlay of money by the firm.  Explicit and Implicit Costs A firm s cost of production include explicit costs and implicit costs. .Costs as Opportunity Costs  A firm s cost of production includes all the opportunity costs of making its output of goods and services.

the firm earns economic profit.  When total revenue exceeds both explicit and implicit costs. Economic profit is smaller than accounting profit.  Accountants measure the accounting profit as the firm s total revenue minus only the firm s explicit costs. including both explicit and implicit costs.Economic Profit versus Accounting Profit  Economists measure a firm s economic profit as total revenue minus total cost.  .

Economic versus Accountants How an Economist Views a Firm How an Accountant Views a Firm Economic profit Accounting profit Implicit costs Total opportunity costs Revenue Revenue Explicit costs Explicit costs .

The Short Run versus the Long Run  Short-run: Period of time in which quantities of one or more production factors cannot be changed. .  Long-run Amount of time needed to make all production inputs variable. These inputs are called fixed inputs.

Isoquants  Assumptions Food producer has two inputs ‚ Labor (L) & Capital (K)  Isoquants Curves showing all possible combinations of inputs that yield the same output .

output increases with more K.Isoquants  Observations: 1) For any level of K. . output increases with more L. 2) For any level of L. 3) Various combinations of inputs produce the same output.

Production Function for Food Labor Input Capital Input 1 1 2 3 4 5 20 40 55 65 75 2 40 60 75 85 90 3 55 75 90 100 105 4 65 85 100 110 115 5 75 90 105 115 120 .

Q3 = 90 1 1 2 3 D Q2 = 75 Q1 = 55 4 5 Labor per year . and 90.K) Capital per year 5 4 3 2 E The Isoquant Map A B C The isoquants are derived from the production function for output of of 55. 75.Production with Two Variable Inputs (L.

.Isoquants Input Flexibility  The isoquants emphasize how different input combinations can be used to produce the same output.  This information allows the producer to respond efficiently to changes in the markets for inputs.

The Cost Minimizing Input Choice  The Isocost Line C = wL + rK W: wage (price of labor) r = Depreciation Rate + Interest Rate. (user cost or price of capital) Isocost: A line showing all combinations of L & K that can be purchased for the same cost .

(w/r)L Slope of the isocost: (K (L !w .Cost in the Long Run The Isocost Line  Rewriting C as linear: K = C/r .

r ‚ is the ratio of the wage rate to rental cost of capital. ‚ This shows the rate at which capital can be substituted for labor with no change in cost. .

We will do so by combining isocosts with isoquants .Choosing Inputs  We will address how to minimize cost for a given level of output.

both of these are higher cost combinations than K1L1. Isocost curve C0 shows all combinations of K and L that can produce Q1 at this cost level.Producing a Given Output at Minimum Cost Capital per year Q1 is an isoquant for output Q1. However. K2 CO C1 C2 are three isocost lines A K1 K3 C0 L2 L1 C1 L3 Q1 Isocost C2 shows quantity Q1 can be produced with combination K2L2 or K3L3. C2 Labor per year .

B K2 A K1 This yields a new combination of K and L to produce Q1. the isocost curve becomes steeper due to the change in the slope -(w/L).Input Substitution When an Input Price Change Capital per year If the price of labor changes. Combination B is used in place of combination A. The new combination represents the higher cost of labor relative to capital and therefore capital is substituted for labor. Q1 C2 L2 L1 C1 Labor per year .

(K (L ! MP L MP K ! w r Slope of isocost line ! (K and ! MPL MPK !w r (L .Cost in the Long Run  Isoquants and Isocosts and the Production Function MRTS ! .

Cost in the Long Run  The minimum cost combination can then be written as: MPL w ! MPK r Minimum cost for a given output will occur when each dollar of input added to the production process will add an equivalent amount of output. .

Cost in the Long Run  Cost minimization with Varying Output Levels A firm s expansion path shows the minimum cost combinations of labor and capital at each level of output. .

$2000 Isocost Line Expansion Path C 100 75 B 50 A 25 200 Unit Isoquant 300 Unit Isoquant 50 100 150 200 300 Labor per year .A Firm s Expansion Path Capital per year 150 $3000 Isocost Line The expansion path illustrates the least-cost combinations of labor and capital that can be used to produce each level of output in the long-run.

The Inflexibility of Short-Run Production Capital per year E C The long-run expansion path is drawn as before. Long-Run Expansion Path A K2 P K1 Q1 L1 L2 B L3 D F Labor per year Short-Run Expansion Path Q2 ..

End of today Thx .