Understanding Firm Short Run Cost Curves

Рет қаралды 81,106

Күн бұрын

Hi everyone in this video I look at understanding the firm’s short-run cost curves, so both identifying the curves and understanding their shape. This is a pretty long one, so for those wanting more content rather than less.
I address Total Costs (TC), Variable Costs (VC), Fixed Costs (FC), Marginal Costs (MC), Average Total Costs (ATC), Average Variable Costs (AVC) and Average Fixed Costs (AFC).
I skip explaining why MC intersects ATC and AVC at their minimum. I do have a video on this, it is here: • Why the Marginal Cost ...
Timestamps:
0:00 Introduction
0:27 Total, Fixed and Variable Costs
2:59 Explaining the Slopes of Total Cost Curve
6:28 Marginal Cost
8:30 Average Variable Costs
10:34 Average Fixed Costs
Hope you guys are doing well!! xo

Пікірлер: 77

@Ok-li6mg Ай бұрын

THANK U SO MUCH THIS IS THE ONLY TOPIC I STRUGGLED THIS MUCH TO UNDERSTAND

@zackgrey4472 9 ай бұрын

Summarized my first 2 weeks of a UCLA technology microeconomics class in 12 minutes, you're the best!!!

@econhelp_official 9 ай бұрын

Wow that’s awesome thanks so much for your comment! Good luck with your course, you’re going to do amazing!

@youngg5099 7 ай бұрын

an absolutely phenomenal explanation of the cost curves. probably the best explanation of a topic I have ever seen on KZfaq.

@econhelp_official 4 ай бұрын

This is such a lovely comment, thank you so much. I'm sorry about the late reply, I wanted to leave the comment on my analytics homepage for a bit so that I could see it (once I reply I don't see it on my analytics anymore). I hope that your studies went well! So happy to help, hope the studies went well ❤️❤️

@WijthaGayan Жыл бұрын

This is the first time I have actually subscribed to a channel. I really appreciate the way you explain this concept. You make it really easy to understand and learn. Thank you !

@econhelp_official Жыл бұрын

Awesome, thank you! Sometimes I feel self conscious about my videos, but comments like these make it worth it and help me make more, thank you so much 🥰

@divyanshagrawal3898 2 жыл бұрын

This helped me out so much. I was really confused in class, but now I actually get what's going on. Thank you so much!

@econhelp_official 2 жыл бұрын

Glad it helped! Class can be confusing, I know all about that. Good luck with your study keep up the good effort!! :)

@tanmaychopra4239 Жыл бұрын

Marvellous. So beautifully explained! Subscribed!

@econhelp_official Жыл бұрын

Thanks and welcome! You're comments are much appreciated!

@mikailasurya Жыл бұрын

this video is awesome!!! your explanation is perfect

@econhelp_official Жыл бұрын

So happy to help! Thanks so much for your comment, hope you are doing well with your studies 👍🙏

@sachithralakshani1110 2 жыл бұрын

Useful. Appreciate your explanation.

@econhelp_official 2 жыл бұрын

Glad it was helpful! Thanks!

@alonakashtanov9408 Жыл бұрын

So very helpful, Thank you so much for this great explanation

@econhelp_official Жыл бұрын

Glad it was helpful! Good luck with your study and thanks for the comment :)

@Cain0023 Жыл бұрын

Sooo helpful for revision, thanks dude

@econhelp_official Жыл бұрын

You're welcome, thanks for the comment! Good luck with your study :)

@nelisafreitas739 Жыл бұрын

This is brilliant thank you so much, you are resourceful.

@econhelp_official Жыл бұрын

You are very welcome 🙏 glad I could help

@bellewhite6996 Жыл бұрын

this was so helpful, thanks a bunch!

@econhelp_official Жыл бұрын

You're so welcome! thanks for the comment ❤️❤️

@user-mi6bw4il1n 6 ай бұрын

Thank you, you are an amazing educator !!

@econhelp_official 5 ай бұрын

Aw too kind, thanks so much :)

@tubagusdaffaxi1216 Ай бұрын

Thank you very much from Kyoto. Your explanation is very easy to understand😄

@econhelp_official Ай бұрын

I'm so glad! Thanks for letting me know, and good luck with your studies 👍👍

@ChampagneTina-gn7wn 2 ай бұрын

Fantastic! Awesome!

@hasibhaidar51 2 жыл бұрын

your videos are very helpfull ,thanks

@econhelp_official 2 жыл бұрын

So nice of you to say! Thanks so much!

@Pidamoussouma 2 жыл бұрын

Very good explanation ma'am... Thanks a lot

@econhelp_official 2 жыл бұрын

Most welcome 😊 Good luck with your study!

@artemiss1675 5 ай бұрын

Thank u so much i really feel that i understood for the first timeeee

@econhelp_official 4 ай бұрын

Youre welcome! I'm so glad the video helped! ❤️❤️

@arshdeepsinghsidhu4973 Жыл бұрын

Nicely explained....💯

@econhelp_official Жыл бұрын

Thanks so much!! 😁 so happy to help!

@thuytrinh3970 Ай бұрын

thank you !

@uzayrkhan9201 2 жыл бұрын

Really helpful. Can you make a video explaining long run Costs and increasing and decreasing returns to scale?

@econhelp_official 2 жыл бұрын

Yes! I will try. I have a baby at home atm but will try to do it quickly :)

@Maps05 7 ай бұрын

Thank you , I so much understand this

@econhelp_official 4 ай бұрын

You're welcome! Thank you so much for the comment, I hope that your studies went well!

@poojasenthil4859 2 жыл бұрын

AHHHHH, I love you and thanks a lot for teaching me this concept. But it'd have been better if i had the data table

@econhelp_official 2 жыл бұрын

Glad it helped! Thanks for the feedback I will take this on board :)

@mukib_khan_ Жыл бұрын

Best explanation 😊

@econhelp_official Жыл бұрын

I’m so glad you think so!! ☺️ thanks for the comment ❤️

@user-ie6xi8ln4j 9 ай бұрын

really helpful thank you

@econhelp_official 9 ай бұрын

Glad it helped! thanks so much for the comment and good luck with your studies!

@tarunverma7088 11 ай бұрын

Beautifully explained the diminishing marginal product

@econhelp_official 11 ай бұрын

Thank you for saying so! I appreciate the comment!

@aroosaroos4343 9 ай бұрын

Thank you so much Ma'am ❤

@econhelp_official 9 ай бұрын

Most welcome 😊 thanks for the comment!

@Lily-cl6zk 5 ай бұрын

amazing

@econhelp_official 5 ай бұрын

Thank you! Cheers! :)

@goranpavloski845 Жыл бұрын

Can u makea video of how's the production function related to cost function

@econhelp_official Жыл бұрын

Yes, I’ll try to do it soon, thanks for the suggestion

@davidayodele6046 Жыл бұрын

Very nice... nice voice too😊

@econhelp_official Жыл бұрын

Thank-you! Good luck with your studies :) :)

@abhicasm 2 жыл бұрын

Why mc cuts avc at the minimum point of avc i don't understand this topic ......plsss explain

@econhelp_official 2 жыл бұрын

Hi Abhishek, I address this point here kzfaq.info/get/bejne/Y8yYl5xkndWveaM.html when I discuss why MC intersects ATC at the minimum. It's the same logic for AVC, basically when MC > AVC, then AVC increases. When MC < AVC, AVC decreases. If MC = AVC, then AVC is stationary (stationary point is the turning point). Hope that helps!

@abhicasm 2 жыл бұрын

@@econhelp_official thank you mam

@lakhnooamerica9667 Жыл бұрын

How do I find level of output if I know the marginal cost?

@econhelp_official Жыл бұрын

If perfect competition set p=mc if imperfect competition set mr=mc. Maybe this video will help: Understanding Profit Maximisation (with two examples) kzfaq.info/get/bejne/mJ-Pg9NpnLuwoYE.html

@mahalaxmibadiguir9350 2 ай бұрын

In the long run all the cost should get covered. Then why afc doesnt touch x axis?

@econhelp_official 2 ай бұрын

These are just measures of costs. It doesn’t change if they are paid or not. My dinner cost me $10, before I paid for it and after I paid for it. Does that help?

@Margaretqian Жыл бұрын

i understand the theory, can we explain it in maths proof ?

@econhelp_official Жыл бұрын

Hi! I haven't seen anything like this. Part of the problems is that it's very difficult to find production equations that will have all of the features that I discuss in the video. What you see, in practice, is that economists chose functional forms in their models that exhibit some (or most) of the features that are important for their question (and which are easy to use - solvable at the least). For instance, Cobb-Douglas production functions exhibit diminishing MP in either Labour or Capital, and also can be written such that production exhibits constant returns to scale, increasing returns to scale or decreasing returns to scale (depending on the exact characterisation of the function). I hope that helps!!

@BWV478 11 ай бұрын

I must be stupid but I don't understand why AVC goes up ... I would think that economy of scales makes any additional output less and less costly. Marginal cost should go down as companies improve they processes and labour get better at their jobs.

@econhelp_official 11 ай бұрын

You're not stupid! Thanks for the question, it's all about the increasing Marginal Cost of production due to diminishing Marginal Product because of the fixed input to production. If you understand/accept this, then it follows that Average Variable Costs increases - each unit becomes more and more expensive to make, Fixed Cost stays the same so it must be the Variable Cost component that increases, so Average Variable Costs must be increasing. Does that help?

@BWV478 11 ай бұрын

@@econhelp_official I understand thanks! What I was missing was the 'fixed input to production'. Have a great day.

@econhelp_official 11 ай бұрын

Good job! Good luck with your studies 👍

@econhelp_official 11 ай бұрын

I'll also add (because I didn't read your first comment well enough!), economies of scale is a long run concept (so both inputs are variable), this video is just for the short run.

@CynthiaLouann Жыл бұрын

still confused.......

@econhelp_official Жыл бұрын

Sorry to hear that, feel free to ask a specific question I’ll try to help!

@economi 2 жыл бұрын

bits have poor explanation, such as AVC

@econhelp_official 2 жыл бұрын

Thank you for your feedback

@economi 2 жыл бұрын

@@econhelp_official i feel bad, I was tryna rush the understanding whilst not being very good at economics. The video was good and I think you linked a video that helped to explain the issue, the video is good but I think I just required the extra mile to understand the process

@econhelp_official 2 жыл бұрын

Aw that’s okay!! All feedback is good! I should have asked if you needed any more help, are you okay with your understanding now?