Theory of the Firm

In the theory of the firm, we’re talking about things that happen over one period. Why then are we drawing revenue and cost curves over a range of values? In any given period, aren’t we going to be dealing with just one value for each item of costs and revenue?

Hi there. not sure why you say there is only one period. in the theory of the Firm, there is long term and short term. the short term is when you cannot change your fixed costs. the long term is when you can change your fixed costs (for example, terminate the lease or shut down the factory). I think you need to let go of the idea that it is one period.

good luck.