Indiv. Work Firms, Opportunity Costs, and Profits Review for AP Economics - Teorie Economica

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Firms, Opportunity Costs, and Profits Review for AP Economics Main Topics: The Firm, Accounting and Economic Profit, Explicit and Implicit Costs, Short Run and Long Run The Firm When we talk about consumers, it's very easy to imagine yourself in the leading role. However, when the conversation switches to the firm, it is often much more difficult to visualize what it is, or who we are talking about. The firm can bring to mind many things to many different people. The firm can be an independent bookstore in your town, or it can be Barnes & Noble. It can be a street vendor selling hot dogs or it can be Oscar Mayer. Regardless of the size of the business, a firm is defined as: "An organization that employs factors of production to produce a good or service that it hopes to profitably sell." Profit and Cost: When CPAs and Economists Collide Before we launch into a technical discussion of production and costs, we need to take care of, well, a technicality. The bottom line is that the accountant sees profit differently than does the economist.