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銆€銆€Cost as a Factor in Supply

銆€銆€In a purely competitive market锛� the supplier of goods and services has no control over-the market price锛� because he produces too little to influence market conditions. With no difference between his products and the products 銆€銆€銆€銆€銆€(1)his competitors锛� he will sell nothing if he charges above the market price and he will sell all if he charges at or銆€銆€銆€銆€銆€ (2)the market price. However锛� in considering the price锛� he must take the 銆€銆€銆€銆€銆€(3)of production into consideration. There are times when he may be willing to sell below his cost. This might happen when prices tumble for 銆€銆€銆€銆€銆€(4)he believes will be a short time. However锛� no business person can 銆€銆€銆€銆€銆€(5)to lose money for a prolonged period. He must be constantly 銆€銆€銆€銆€銆€(6)of his costs in relation to the market price if he is to compete successfully and earn a profit.

銆€銆€Many people have the impression that as production increases锛� costs per unit decrease. 銆€銆€銆€銆€銆€(7)mass production has made this true in certain industries and at certain levels of production锛� 銆€銆€銆€銆€銆€(8)logic and practical experiences have shown that costs per unit begin to rise beyond a certain level of production. Some economists 銆€銆€銆€銆€銆€(9)to this principle as the law of increasing costs.

銆€銆€The reason costs rise as production goes up is銆€銆€銆€銆€銆€ (10)銆� However锛� it is easy to recognize that as production goes up锛� the need for additional factors of production will also grow锛� 銆€銆€銆€銆€銆€(11)competitive bidding in the marketplace for the factors of production. If a producer needs銆€銆€銆€銆€銆€ (12)skilled labor to produce more锛� and none of this labor is unemployed锛� the producer will have to get 銆€銆€銆€銆€銆€(13)from other sources. This can be done by 銆€銆€銆€銆€銆€(14)higher wages. Higher bidding would also apply to the other factors of production. We must also recognize that not all labor is equally productive锛� 銆€銆€銆€銆€銆€銆€(15) not all land is equally fertile and not all ore (绀︾煶) is equally rich in the mineral wanted.

銆€銆€1 A to B at C of D on

銆€銆€2 A below B beneath C over D above

銆€銆€3 A price B cost C worth D profit

銆€銆€4 A that B why C what D if

銆€銆€5 A afford B pretend C offer D decide

銆€銆€6 A sure B afraid C aware D suspicious

銆€銆€7 A Because B Since C When D While

銆€銆€8 A both B neither C none D any

銆€銆€9 A resort B refer C turn D attend

銆€銆€10 A clear B simple C difficult D complex

銆€銆€11 A bringing B resulting in C including D carrying out

銆€銆€12 A less B numerous C more D many