2.5: Short Run Profit Maximization - Class Notes

Contents

Overview

Today we finish up costs from last lecture, and discuss revenues before we put them together next class to solve the firm’s profit maximization problem. We focus on the short run, where the firm incurs fixed costs and must stay in the market regardless. We derive the firm’s (inverse) supply curve.

Class Livestream/Lecture Videos

Slides

Practice Problems

Today we will be working on practice problems. Answers are posted on that page.

Assignments: Exam 1 Corrections, Homework 3, Homework 4

You will have until the end of the semester (May 4) to turn in your corrections, however, I advise you to do them as soon as possible. See more from the online transition page for details.

Homework 3 isdue, via email, on Sunday, March 29, by 11:59PM. The answer key will be posted Monday, March 30.

Homework 4 is posted, via email, on Sunday, April 5, by 11:59PM. The answer key will be posted Monday, April 6.