<h2>Introducing the Structure of Costs in the Short Run</h2>
The cost of producing a firm’s output depends on how much labor and physical capital the firm uses. A list of the costs involved in producing cars will look very different from the costs involved in producing computer software or haircuts or fast-food meals.
However, the cost structure of all firms can be broken down into some common underlying patterns. When a firm looks at its total costs of production in the short run, a useful starting point is to divide total costs into two categories: fixed costs that cannot be changed in the short run and variable costs that can be changed.

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The Structure of Costs in the Short Run

Economics studies social behavior guiding the allocation of scarce resources to meet the unlimited needs and desires of the individual members of a given society, and for the production of goods and services, growth of production and welfare over time, and a great variety of other complex issues of vital concern to society. 

Economics

Discover how costs and industry structure relate, learn about explicit and implicit costs, accounting and economic profit, and delve into key concepts and summaries, the structure of costs in the short and long run, the choice of production technology, economies of scale, long-run average cost curve shapes, and more.


The Structure of Costs in the Short Run

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