Economics

• Perfectly Elastic Demand Curve


  In perfect competition, firms have no price setting power so the price received is constant thus MR=AR=D. TR is upward sloping as the more units sold the higher the revenue.
• Downward Sloping Demand Curve


  Price decreases as output increases thus AR is downsloping. D=AR as it indicates the price consumers are willing to pay per unit. TR rises when MR is positive, peaks when MR=0 and falls when MR is negative. This occurs in imperfect competition where firms have some price-setting power
• Fixed Costs


  Costs that do not change with the level of output
• Variable Costs


  Costs that change with the level of output
• Short Run Costs


  When at least one factor of production is fixed this is usually capital in the long run all factors are variable
• Solutions for Structural Unemployment

  -Relocation subsidies

  -Investment in education and training

  -Greater transport network
• Evaluation of Real Wage Unemployment

  -Not the case for highly-skilled labour as minimum wage either has no or minimal impact as the demand and supply of labour is inelastic

  -Low-skilled labour has very elastic demand and supply