= 0 moving things around we get (dTR)/(dq) = (dTC)/(dq) or the derivative of total revenue with respect to q is equal to the derivative of total cost with respect to q. The derivative of total revenue is marginal revenue, and the derivative of total cost is marginal cost. And thus you come to the profit maximizing equation of MR = MC In the case of a competitive firm, the firm is free to sell all the q it wants at the market price without the firm having a notable affect
Words: 949 - Pages: 4
preparing in advance for the spike in gas prices by purchasing a vehicle that is fuel efficient, while others pay no mind to the rising prices. What are the three reasons that law demand exists. Explain. The three laws of demand are diminishing marginal utility, income effect and substitution effect. Diminishing utility- Is described as, the more a consumer purchases an item, and their satisfaction will deteriorate over time. For example, I have a love of racing RC cars, as I buy more I become
Words: 322 - Pages: 2
cost of maintaining the cow as an alternative means of determining appropriate cow size. Hint: Calculate marginal revenue and marginal expense. Which method (50% weaning rule or marginal analysis) do you think provides the best measure? Why? Answer: The most appropriate method that is used to compare a calf value to the cost of maintaining the cow is the marginal analysis as it gives the marginal revenue that is calculated as changes in the revenue is divided by the changes in output in terms of quantity
Words: 671 - Pages: 3
Based on the marginal utility theory to analyze students’ demand for… 1. Introduction:.….…………………………3 1.1 Origin of Marginal Utility Theory………………………….3 1.2 Development of Marginal Utility Theory…………………..3 2. The analysis of marginal utility theory...4 2.1 The definition of marginal utility theory………...…………4 2.2 The understanding of marginal utility theory………...……5 2.3 The main influences on marginal utility……….……………5 2.4
Words: 2146 - Pages: 9
Which of the following products can be sold through mass advertising? Answer Selected Answer: A new brand of baby diapers Correct Answer: A new brand of baby diapers Which of the following products should be sold face-to-face rather than by mass advertising? Answer Selected Answer: A pharmaceutical which can only be understood by doctors Correct Answer: A pharmaceutical which can only be understood by doctors Which of the following is considered to be a cost
Words: 10396 - Pages: 42
1. Assume FinePrint is currently operating at full capacity of 150,000 brochures per month, should the special order from Abbie Jenkins be accepted? [In answering, assume Ernest Bradley has not yet made his offer to handle 30,000 brochures and that FinePrint cannot increase capacity beyond 150,000 brochures per month.] FinePrint should not accept the special order from Abbie Jenkins. Since, John Johnson’s goal is to maximize profits, FinePrint would only accept the special order if it increased
Words: 1157 - Pages: 5
you will be creating your brand: please think about what you are saying about yourself when you do any work for someone else! 1. Consider a monopolist where the market demand curve for the produce is given by P = 520 – 2Q. This monopolist has marginal costs that can be expressed as MC = 100 + 2Q and total costs that can be expressed as TC = 100Q + Q2 + 50. a. Given the above information, what is this monopolist’s profit maximizing price and output if it charges a single price? Answer: MR
Words: 4706 - Pages: 19
* Average fixed, average variable, and average total costs are fixed, variable, and total costs per unit of output; marginal cost is the extra cost of producing one more unit of output. * Average fixed cost declines continuously as output increases; average-variable-cost and average-total-cost curves are U-shaped, reflecting increasing and then diminishing returns; the marginal-cost curve falls but then rises, intersecting both the average-variable-cost curve and the average-total-cost curve
Words: 554 - Pages: 3
Income Effect | (A) | Increase | Decrease | (B) | Increase | Increase | (C) | Increase | No change | (D) | Decrease | Increase | (E) | Decrease | No change | 5. Short-run marginal costs eventually increase because of the effects of (A) increasing marginal product (B) diminishing marginal product (C) diseconomies of scale (D) economies of scale (E) increasing fixed costs 6. If a government eliminated an effective price floor in a market, all of the following
Words: 4124 - Pages: 17
Chapter 1 1.0. Available Sources of Funding to Hospitality Industries Introduction: Hospitality industry in UK has got problems from securing funds through banks which is supposed to be reliable source of business funding. This fact has made it necessary to look beyond banks to assists with the growth of the business. HOSPACE 2013. Ben McClure, 2015 says “it is necessary that hospitality industry considers only financial funding that will not lead the business into future problems”. As if
Words: 4830 - Pages: 20
