Chapter 13: The Cost of Production

[@udontknowme154]

i ve been crying because i could not understand the depths of this. This has literally saved me from failing. i feel so much better, this dosent make me feel dumb , love this❤

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ur literally such a great teacher and im literally wishing the best for you the rest of my life

[@DrAzevedoEcon]

Thank you! I appreciate that.

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This is AMAZING. Production and Cos Functions are explained with ease. Thank you.

[@deanzebari8274]

I couldn't thank you enough for giving a lecture video on this chapter! This helped me so much and I understood certain material much better after watching this video than my professor giving a lecture in class.

[@DrAzevedoEcon]

I'm glad the video helped clarify things!

[@LikhithA-w7p]

i want to thank you whole heartedly sir , very clearly explained , i have my exams and i scored good marks only because of you !!!!!

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You are so awesome. Every time I watched again and again, I still learn something. Thank you so much

[@DrAzevedoEcon]

Thanks! I'm happy to hear that it has helped you out!

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it's never been this easy to learn econ. thank you sm!

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Great! Everything is clearer now. Thank you for this beautiful lesson

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i wish this guy was my professor! i'm nearing my first university final exams and i feel more confident in economics than before.

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Have my tests in a few days. Good luck.

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​@@swarajdash9975Good luck!

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[@DrAzevedoEcon]

Very happy to be able to help!

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Thank you very much Dr. Azevedo for such a great video! It is user friendly and easy digesting for such a complicated concept. I like all the examples you have been given in the video! Please post more great videos in youtube! Always support!!!

[@mehmetciftci3163]

Your videos are really explanatory for economics students thank you for the lectures from Turkey.

[@DrAzevedoEcon]

You're welcome! Happy to help!

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@@DrAzevedoEconI got 100 from the final exam, I got 72 before I met you, but I got 100 after watching your videos, thanks again professor

[@DrAzevedoEcon]

@@mehmetciftci3163 Great job!

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from Brunei being helped as well

[@mikkyyy793]

Can we have more lectures ... U r great teacher☺️

[@nguyenat7560]

OMG thanks sir for uploading this video, this is easier to understand than hearing my lecturer in the universtity 😭😭😭😭😭😭😭😭

[@sam-1810]

I was looking for resources I can use to learn Economics. I searched many times but I couldn't find a good one. Today I was so down because I couldn't understand this lesson after spending so many hours. So my mum searched for it online and decided to select this video. I'm glad of everything that happened that made me access this video ❤. Thank you for posting ❤

[@DrAzevedoEcon]

I'm glad you found the videos! Good luck with your studies!

[@nangmomotheda3884]

crystal clear lectures, thank you teacher.

[@DrAzevedoEcon]

Glad to help!

[@JabulaniSimapempa]

The you so much sir, I able to understand in depth about production and cost now,.. Cheers 🥂 to success 🥂

[@hassanansari5515]

Incredible content Sir love from Pakistan 💛

[@DrAzevedoEcon]

Thank you! Thanks for watching!

[@naf6933]

Your content is really excellent. Please, make more Videos on other topics like macroeconomics

[@udontknowme154]

subscribed, this is so good❤

[@Marco-Mandy]

Amazing Explanation.

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Thank you sir! That was really beneficial

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Love your voice & delivery!

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Awesome video!

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loved it .. nicely explained

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Thanks sir this videoes gives more information than my lectures

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awesome , thank you for your superior efforts ❤

[@ShadowFEB3]

Nice job sir

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You are motivating me to think like an economist,

[@DrAzevedoEcon]

Great! I wish everyone thought that way.

[@mahadiullah878]

Exquisite explanation!

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Best teacher!

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Very well explained 👍

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Thank you so much!! I want you to know that you truly helped me a lot. Thank you!!

[@DrAzevedoEcon]

You’re welcome! I’m glad the video was helpful!

[@brendanberry3103]

Thanks for saving my Assvedo Professor Azevedo

[@DrAzevedoEcon]

Haha! Happy to help!

[@Ujh294]

Thank you so much for the video sir 🙏 Your efforts and expertise are highly commendable.

[@DrAzevedoEcon]

You're welcome! Glad to help!

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Best i have ever seen😮😮😮

[@DrAzevedoEcon]

Thanks!

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Great Lecture !💯💯

[@DrAzevedoEcon]

Thanks!

[@tanas2169]

God bless U, Man.

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thank you very nice class.

[@mikkyyy793]

We need concepts of another ch. Too..

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the most helpful video on yutube!thx!!

[@madhavhans2289]

Thank You for this very Great Video but Why, if you don't mind, you don't post videos now? And can you also tell how you record these videos. Otherwise Thank You So Much. This is so much more clearer to me now.

[@yousufmiya8159]

You are really great teacher... How can i find the lectures other chapters?

[@DrAzevedoEcon]

Thank you! Here's the playlist for the principles of microeconomics videos that I have available right now. I also have macro videos available as well in a separate playlist. kzbin.info/aero/PLTjEimbqDkpBL55W6wye1jTcYePjehkT3

[@anushkagupta3962]

nicely explained

[@udontknowme154]

mind blown

[@nikhilfci]

Sir , is there any reason why some chapters are missing in U TUBE?

[@zanderlowell5805]

How you be doign the thang with the board??? ARe you being having writing backwards?? If so you are reall ygood at it!!! Love you, ZAndy

[@DrAzevedoEcon]

Not writing backward. I'm writing on glass, and then the image is reversed so that it's readable. Happy to help!

[@interestingfacts67959]

Very helpful

[@SinaloMbebe]

100% clear

[@sohanshrestha9466]

Why is the cost of raw materials not included in the TC(in the example)??

[@humayra8703]

😍😍Thank you sir

[@MKLee369]

Dr Azevedo, thanks for your great video, but I have a question regarding cost of production when attending my lecture. My professor says that 'Technological advance may result that firm uses more capital and less labor, so fixed costs increase and variable costs decrease. ATC increases at low output levels and decreases at high output levels'. But the ATC curve is U-shaped. The ATC should decrease at low output level and increase back at high output level instead of converse. My understand is that ATC curve looks like "concave downwards" when technology improves?? I actually don't understand what my professor means. Hope you can solve my question. Thanks!

[@DrAzevedoEcon]

Honestly, I'm not sure what your professor is saying either. Maybe there's a misunderstanding somewhere. Typically, we would think about a technological advance as shifting the cost curves. For example, technological progress typically makes production cheaper, so the cost curves would shift down. Firms can also freely substitute between capital and labor (in the long-run), so there's nothing wrong with saying that a firm's fixed costs could increase and variable cost could decrease. However, this is very different from describing how ATC is affected by changes in output. If your professor is saying that the ATC curve is inverted....that's not true. Fixed costs are fixed....obviously. This means that AFC has to decline as output increases (because output is in the denominator). Variable costs increase as output increases. When you produce more output, you need more inputs, which costs more. AVC can be U-shaped, but will eventually increase due to the law of diminishing marginal product. If AFC is decreasing as output increases, and AVC is eventually increasing as output increases, the ATC curve is U-shaped. In other words, these two things together rule out the possibility of an "inverted" ATC curve.

[@MKLee369]

@@DrAzevedoEcon I have tried by myself to figure what is the meaning of 'ATC increases at low output level and decrease at high output level' by contructing a table of Q, FC, VC ... like what you did in the video. It turns out that compared to original ATC curve, when TFC (thus AFC) increases and (TVC thus AVC) decrease, when Q is low, the new ATC curve starts from a higher position that original ATC curve. Then the new curve decrease more rapidly than old curve (so new and old curve intersects at one point). After that point, the new ATC curve is always below the original ATC curve. I think that is the actual meaning of my professor. Though still thank you professor as you let me understand more deeply why ATC curve has to be U-shaped. My professor just teach one example of shifting cost curve, and then just said 'Figure out other possibilities by yourself and read the rest of ppt'.

[@DrAzevedoEcon]

@@MKLee369 Happy to help!

[@imas8232]

Thank you so much!

[@Taniya47000]

Thankyou sir😊

[@DrAzevedoEcon]

You're very welcome!

[@island48]

Thank you 😊

[@DrAzevedoEcon]

You're welcome! Thanks for watching!

[@mortazakhawari923]

thank you so much

[@bbeeyangli]

Perhaps it would be better if economic theories excluded the concept of opportunity cost. This is because it can lead to confusion and cannot be precisely quantified mathematically. There are countless potential opportunity events (for example, one of the myriad possibilities when someone decides to do something might be getting visited by aliens and gaining superpowers, haha). Even if we select the few with the highest benefits, it's still difficult to scientifically quantify them precisely. It might be better to choose several different path events and then compare their respective benefits. Regarding the law of diminishing marginal utility, consider a treasure chest that requires five identical keys to be inserted simultaneously to open (or a lottery, where the more correct numbers you have, the bigger and faster the prize). In this scenario, each found key increases happiness progressively, with the joy from finding the last key potentially overwhelming someone with happiness. Additionally, there are cases where the combined effect of the parts is greater than their simple sum, resulting in an increasing effect. also,For instance, the marginal utility of scientific discoveries or technological advancements, when viewed historically, is increasing. The benefits brought about by technological developments in the past few decades far surpass those of the past.

[@NhuNguyen-rh7bp]

Thank you so much.

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So great to see Vietnamese here

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you are my saver

[@DrAzevedoEcon]

Happy to help!

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thank you so much i feel i owe you

[@DrAzevedoEcon]

You're welcome! You don't owe me a thing....just do your best on your exams.

[@nikhilfci]

Please upload chapter 8 and other missing chapters

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Thank you so much sir :)

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Thanks a lot

[@DrAzevedoEcon]

You're welcome!

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Thanks sir...

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Have an exam within an hour. Thank you

[@hanrong5856]

Hello,professor!where is chapter 8?

[@bbeeyangli]

where is chapter 12?

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this one is tough

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thank youuu

[@DrAzevedoEcon]

You're welcome!

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32:46

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Saviour

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Glad to be able to help!

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[@DrAzevedoEcon]

You're welcome!

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ARE YOU JESUS!!!

[@DrAzevedoEcon]

Nope...just an econ professor.

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You are a priceless professor big greetings from Cairo Egypt faculty of business ain shams 🫡❤

[@JabulaniSimapempa]

The you so much sir, I able to understand in depth about production and cost now,.. Cheers 🥂 to success 🥂