Marginal revenue, marginal cost & profit maximization, Microeconomics

Assignment Help:

Marginal Revenue, Marginal Cost & Profit Maximization

* Determining profit maximizing level of output

- Profit (π ) = Total Revenue - Total Cost

- Total Revenue (R) = Pq

- Total Cost (C) = Cq

- Therefore:

1303_marginal revenue3.png

449_marginal revenue.png


966_marginal revenue1.png

Marginal Revenue, Marginal Cost & Profit Maximization

* Marginal revenue is additional revenue from producing one more unit of output.

* Marginal cost is additional cost from generating one more unit of output.

1274_marginal revenue2.png

* Comparing R(q) and C(q) 

- Output levels: 0- q0:                        

  • C(q)> R(q)

Related Discussions:- Marginal revenue, marginal cost & profit maximization

Functions of the central bank, Functions of the Central Bank: Currency...

Functions of the Central Bank: Currency issue and distribution: The Central Bank is the only institution empowered by law to issue currency notes and coins that are used as a

What are expansionary and contractionary effects, What are expansionary and...

What are expansionary and contractionary effects?  Expansionary effect refers to the effect of raising the equilibrium level of national income. For example, an increase in gov

Periodic table, which three group of the periodic table contain the most el...

which three group of the periodic table contain the most elements classified as metalloids (semimetals)?

Define important functions are performed by the price system, What two impo...

What two important functions are performed by the price system? (1) The price system is an automatic method for distributing goods and services. (2) The price system defines t

PERFECT COMPETITION and THE SUPPLY CURVE & MONOPOLY, Chapter 13 / PERFECT C...

Chapter 13 / PERFECT COMPETITION and THE SUPPLY CURVE 1. Joe Brown’s dairy operates in a perfectly competitive marketplace. Joe’s machinery costs $500 per day and is the only fixe

Concept of efficiency, The Concept of Efficiency is stated below: To il...

The Concept of Efficiency is stated below: To illustrate this concept of the efficiency, it is used to expand the understanding of what is meant by the Pareto-efficient allocat

Rational self-interest, Discuss the impact of rational self-interest on eac...

Discuss the impact of rational self-interest on each of the following decisions

Regression methods, This is a very common methods of forecasting demand. Un...

This is a very common methods of forecasting demand. Under this methods a relationship is established between quantity demanded( dependent variable) and independent variables such

Find the price elasticity of demand of good, Consider a consumer with the f...

Consider a consumer with the following Cobb-Douglass utility function: U (x, y) = x α y 1-α a)  Find the Marshallian Demand for both goods. b)  Find the Price Elasticit

What is formal economy, Q. What is Formal Economy? Formal Economy:Secto...

Q. What is Formal Economy? Formal Economy:Sector of the economy that produces services and goods in return for monetary payment, and is fully integrated into the formal structu

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd