Define a Variable Cost and a Fixed Cost

question 124

Essay

Define a variable cost and a fixed cost.What causes changes in these costs? Give two examples of each.

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Definitions:

Impossibility Theorem

A proposition demonstrated by Kenneth Arrow showing that no system of aggregating individual preferences into social decisions will always yield consistent, nonarbitrary results.

Voting Paradox

A simple demonstration of how majority-rule voting can lead to seemingly contradictory and inconsistent results. A commonly cited illustration of the kind of inconsistency described in the impossibility theorem.

Social Choice

The problem of deciding what society wants. The process of adding up individual preferences to make a choice for society as a whole.

Estate

The property that a person owns at the time of his or her death.