中级微观经济学讲义8－成本函数.pdf

Chapter 8 COST FUNCTIONS By WALTER NICHOLSON Slides prepared by Linda Ghent (Eastern Illinois University) Modified by Huihua NIE (Renmin Unversity of China) www.ChinaES. 1 Definitions of Costs • It is important to differentiate between accounting cost and economic cost – the accountant’s view of cost stresses out- of-pocket expenses, historical costs, depreciation, and other bookkeeping entries – economists focus more on opportunity cost – costs minimization=revenue maximization www.ChinaES. 2 Cont’d • Labor Costs – wage bill – economists and accountants regard same • Capital Costs/Asset Costs – Accountants: historical price, depreciation rule – Economists: original price as “sunk cost”, implicit cost of the capital, rental rate (v) www.ChinaES. 3 Cont’d • Costs of Entrepreneurial Services – accountants: residual claimant, profits – economists: consider the opportunity costs of time and funds that owners devote to the operation of their firms – economic profitsaccounting profits, and they both can be negative – all the economic cost is opportunity cost www.ChinaES. 4 Two Simplifying Assumptions • There are only two inputs – homogeneous labor (l), measured in labor- hours which measured as employees – homogeneous capital (k), measured in machine-hours • Inputs are hired in perfectly competitive markets – firms are price (w, v) takers in input markets