Chapter 13, The Costs of Production, talked about how to determine the total costs and revenue the supply firms produce over a short and long run. To start off, one of the laws of economics is mentioned and is crucial to remember-the law of supply. According to the law of supply, suppliers are more willing to produce more goods at a higher price. Therefore, the firms will tend to produce more if they have the money, which results from their profits. To determine, the profits a firm can receive is through the total revenue minus the production costs. The production costs include the amount of money it takes to buy the goods as well as how much opportunity cost is needed and left behind.
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