资产负债表、利润表、现金流量表 关系

资产负债表体现一家公司的实力。利润表以效益为基础，体现的是一家公司的能力。现金流量表体现一家公司的活力。拥有良好的现金流是一家公司保持活力，“想干什么就干什么”的基础。如果你这家公司确实有利润但是没有现金流，那其实什么也干不了，手上有一堆应收账款其实是没有用的。

资产负债表距今已有将近500年的历史了，从意大利的路卡帕乔利就开始有了。利润表大概是1920年以后才被美国和欧洲一些国家要求一定要披露的一个报表。现金流量表是1987年才开始有的。从这个历史发展的维度看，资产负债表要比利润表和现金流量表更为重要。

从另外一个角度来看，利润表其实体现的就是资产负债表里面的一个科目，叫做未分配利润的变动情况；现金流量表其实也只是体现了资产负债表里面的一个科目，就是现金的变动情况。从这个角度上来说，资产负债表是三个报表的核心，所以我们要做财务报表分析的时候，就先从资产负债表开始。

1、利润表和资产负债表

利润来源于收入，收入减去成本费用，就得到利润。这就是利润表的基本。资产负债表上的资产是可以为企业带来收入的，同时，企业在使用这类资产过程中，其耗用又会令资产逐步转化为利润表中的成本费用。

以固定资产为例，当使用固定资产进行生产活动时：一方面其生产出产品，进而通过销售产生收入；另一方面，固定资产的账面价值以折旧方式在资产负债表上逐步减少，而相应金额则以折旧费用的形式出现在利润表的成本或费用中。

2、利润表和现金流量表

利润表和现金流量表都是期间的报表。通过这两张报表，可以从利润与现金流两个不同维度来观察评估企业的赚钱能力。

假设甲、乙两家企业从同一年开始经营，而且利润表的大致情况基本相同：收入一亿元、费用八千万元、净利润两千万元。但是，从现金流量表来看，甲企业通过赊销方式进行销售，也就是说先赚利润，后收钱，所以其经营活动产生的现金流较少；而企业乙要求款到交货，那么其现金流量表中的经营活动产生的现金流就要明显好于企业甲。这两家企业从利润表上看似一致，现金流量表的表现却是大相径庭。

Pigouvian tax: example.

The figure below shows the market for fertilizer. When fertilizer is applied to lawns, it runs off into neighboring streams and ponds, killing fish and creating an external cost.

If the government imposes a tax equal to the marginal external cost. How much is the tax? What is the equilibrium quantity after the implementation of the tax? What is the price paid by consumers?

To understand this question, you need to recall that when a tax is imposed, it creates "a wedge between the price buyers pay and the price sellers receive”, regardless of whether the tax is imposed on the buyers or the sellers. Therefore, we need to find the quantity where

Price paid by the buyers - Price received by the sellers = Tax,

that is to say, we need to find the quantity where the distance between the demand curve and the supply curve is the same as the amount of tax.

On the other hand, we know that tax imposed by the government is equal to the marginal external cost, and

marginal external cost = marginal social cost (MSC) - marginal private cost (MC),

we just need to find the quantity where the distance between MSC and MC is the same as the distance between the supply curve (the same as MC) and the demand curve (the same as MSB). This occurs at the intersection between MSC and MSB, so the quantity is 4 tons.

If the analysis feels a bit complicated, you can simply remember the conclusion: when the government imposes a tax equal to the marginal external cost, then the quantity would be the efficient quantity, that is, the quantity where MSB = MSC. Taxes that are used to restore efficiency from negative externalities as in this case are called Pigouvian Taxes, named after English economist Arthur Cecil Pigou (1877–1959).

Confusion about oligopoly

The table above has the market demand schedule in an industry that has two firms in it. The marginal cost of this product is zero because these two firms have exclusive ownership of the resource and it does not cost any additional amount to produce additional units.

a) If the firms cooperate with each other so that they operate as a monopoly, what price will they charge and what (total) output will they produce?

b) If the firms cannot cooperate but instead behave as perfect competitors, what will be the price and the (total) output they produce?


We are slightly confused about Question (b). I guess the idea is, that they have to set the price equal to marginal costs, because they are now competing. However: 

1. In order for them to not incur an economic loss, they would have to have zero fixed costs. And what firms have zero fixed costs? 

2. In perfect competition, the demand curve faced by the single firm is horizontal because of the fierce competition. But in an oligopoly, the individual firm can only supply part of the market demand if they are to produce at their lowest ATC. So the demand curve facing the individual firm would not be horizontal and therefore they are not pure price-takers? 

3. In general, are firms in oligopoly markets earning zero economic profits in the long run if they are neither colluding nor cheating, but merely competing? It doesn’t seem to say in the book.

Intermediate and advanced microeconomic theory would distinguish different types of competition in oligopoly. When oligopolists collude, the general conclusion is similar (they share the monopoly profit). But competition can be Bertrand competition (price competition) or Cournot competition (quantity competition), and the outcome is also dependent on whether firms produce differentiated products.

Introductory microeconomic textbooks usually do not get into a detailed discussion on oligopoly. In this course, the case we have discussed is what intermediate microeconomic theory would call Bertrand competition -- oligopolists produce homogeneous products and compete by setting different prices. The students only need to know that when oligopolists collude, they share the monopoly profit; when they engage in a price war, they earn zero economic profit.

The reasoning is as follows (take duopoly as an example): when firms produce homogeneous products, they share the market demand when they set the same price, but whenever one firm sets a price lower than the other, it will get all the market demand. Therefore, the demand for an individual firm is indeed a horizontal line, but the height of the horizontal line depends on the price charged by the other firm (that is, the outcomes of the two firms are interdependent). You can visualize the situation by considering two vending machines selling identical products. If one vending machine charges a slightly lower price, then it would get all the quantity demanded by the consumers.

To get deeper into the discussion: the intensity of competition does not only depend on the number of firms in the market. It is more dependent on the substitutability of a firm’s product. Even there is only one firm in the market, but there are potential entrants that can produce the same product, this only incumbent cannot charge a high price (and potentially earn a zero economic profit).

Q1. In order for them to not incur an economic loss, they would have to have zero fixed costs. And what firms have zero fixed costs?

Firms should have positive fixed costs in this case, but fixed costs should not matter when they make production decisions. The fixed costs are forgone in the short run, so only the marginal cost would influence firms’ decisions. Fixed costs only come into play in the long run when the previous investments have run out/depreciated enough and the firm needs to make new fixed costs – but in the long run, all costs are variable costs.

The firms would suffer an economic loss when they set the price the same as the marginal cost, but that is their optimal choice if the other firm is doing so. Of course, this is a theoretical equilibrium outcome. In reality, they would charge the lowest possible price that is higher than the marginal cost, so they could make some profit out of each unit they sell so that they can cover part of the fixed costs.

Q2. In perfect competition, the demand curve faced by the single firm is horizontal because of the fierce competition. But in an oligopoly, the individual firm can only supply part of the market demand if they are to produce at their lowest ATC. So the demand curve facing the individual firm would not be horizontal and therefore they are not pure price-takers?

As mentioned above, firms can face a horizontal demand curve when they engage in a price war, but the firms’ demand curves are interdependent. In a natural oligopoly, each individual firm can only supply part of the market demand if they are to produce at their lowest ATC – but this is not true in general for all oligopoly. In the case of our question where MC is constant, ATC would never reach its minimum -- recall that MC will cross ATC at ATC’s minimum, so ATC will keep decreasing and approaching MC asymptotically.

Q3. In general, are firms in oligopoly markets earning zero economic profits in the long run if they are neither colluding nor cheating, but merely competing? It doesn’t seem to say in the book.


“Firms in oligopoly earning zero economic profits in the long run if engage in a price war.” This statement is correct based on what is discussed in the textbook and in the lecture notes, and it is enough for the students to understand this deep. But when firms engage in Cournot competition or when they produce differentiated products, they could earn a positive economic profit.

Minimum Efficient Scale (MES) and economic efficiency

The Minimum Efficient Scale (MES)  is the smallest quantity where the long-run average cost is lowest. It determines whether a firm has reached economies of its scale, and it is important to determine the market structure – if MES is small relative to the market demand, then the market is likely to have many firms and intense competition; on the other hand, if MES is big relative to the market demand, the market is likely to have a small number of firms. However,  it alone cannot determine whether the firm's profit is maximized or efficiency is achieved. 

To determine whether the firm's decision is optimal (in the sense of profit maximization), we need to compare whether MR is the same as MC at the current level production. 

To discuss efficiency, we always need to compare the benefit vs. the cost of an action -- looking at cost alone cannot determine whether it is efficient. A firm can produce MES, but if no consumers want the products, then the production is a waste of resources and a loss of efficiency. To determine whether the production is efficient for society, we need to compare whether the marginal social benefit (MSB) is the same as the marginal social cost (MSC). Because in this question no externalities exist, social benefit/cost is the same as private benefit/cost, we can simply compare MB and MC. Hope this makes sense.

Production efficiency indicates a producer produces a certain output in the LEAST costly way. Note that the cost function indicates the LOWEST possible cost for producing the corresponding output, so any production following the cost curve achieves production efficiency. MES is therefore not related to production efficiency.

What is economic rent?

Economic rent is a hard term to grasp. According to David Ricardo, rent arises on account of fixed supply of land. But he recognizes other factors which are found in fixed supply in the short term. The additional income earned by these factors in the short-period is similar to rent.

Any payment to a factor of production received in excess of its opportunity cost is economic rent. In our setting, we can safely say that economic rent is used interchangeably with economic profit. Investopedia.com is correct in saying that rent is not the same as normal profit or producer surplus. Normal profit occurs when the economic profit is zero, and profit in excess of the normal profit (i.e., economic profit) is economic rent. Producer surplus is also different from economic profit because it does not take into account of the fixed cost for production (recall that the supply curve is the same as the marginal cost curve, and marginal cost curve does not reflect fixed cost), so economic profit of a producer is less than the producer surplus.

The definition given in the textbook is not wrong, but confusing and unclear. Consumer surplus and producer surplus COULD POTENTIALLY be part of the economic rent. As mentioned above, producer surplus is greater than the economic profit so not all of it is economic rent. Consumer surplus can be switched to economic rent when the producer finds a way to capture it as profit by rent-seeking. When there are no barriers to entry, competition always drives down the economic profit to zero, so economic rent would not exist. Rent-seeking can therefore be considered as ways to mitigate or eliminate competition.

Quasi-rent is a temporary economic rent like returns to a supplier/owner. Quasi-rent differs from pure economic rent in that it is a temporary phenomenon. It can arise from the barriers to entry that potential competitors face in the short run, such as the granting of patents or other legal protections for intellectual property by governments. It can also arise due to entrepreneurial responses to market fluctuation, or due to a lack of real capital to meet near-term increases in demand. In the longer term, however, the opportunity to profit will generate new capital and competition will eliminate the quasi-rent. The joining of opportunism with appropriable quasi-rents (transaction-specific investments) is a leading factor in explaining decisions to vertically integrate. Quasi-rent refers to that additional income which is similar to rent.