Example on changes in fixed costs and profit maximisation, Managerial Economics

Assignment Help:

Q. Example on Changes in fixed costs and profit maximisation?

What if arena owner in the illustration above triples the fee for the subsequent concert but all other factors are the same. What price must the promoter now charge for tickets in light of the fee increase?

The same price of Rs. 10

Fee is a fixed cost, which promoter should consider a sunk cost and simply ignore it in calculating his profit maximising price. Only effect is that promoter's profit will be reduced by Rs. 20, 000.


Related Discussions:- Example on changes in fixed costs and profit maximisation

Market price , Normal 0 false false false EN-IN X-NON...

Normal 0 false false false EN-IN X-NONE X-NONE

Determine the theory of exchange and price theory, Determine the Theory of...

Determine the Theory of Exchange and  Price Theory Theory of Exchange is commonly called Price Theory. Price determination under various types of market conditions comes under

What is normative economics, What is Normative economics It is concerne...

What is Normative economics It is concerned with varied corrective measures that a management undertakes under lots of circumstances. It deals with goal determination, goal dev

Costing, Ask quesCase Study Electron Control, Inc., sells voltage regulato...

Ask quesCase Study Electron Control, Inc., sells voltage regulators to other manufacturers, who then customize and distribute the products to quality assurance labs for their sens

Income elasticity of demand, Aside from the price of a product and its subs...

Aside from the price of a product and its substitutes, another significant element of demand for a product is consumer's income. As noticed previously, relationship between demand

Significance of managerial economics, discuss the significance of manageri...

discuss the significance of managerial economics in regards to business strategies employed by business entities currently operating in the global economy

Managerial economic, gap between economic theory and business practice

gap between economic theory and business practice

Trade cycle-keynes and mitchell description, Keynes and  Mitchell Descript...

Keynes and  Mitchell Description According to Keynes description, a trade cycle is characterised by alternating expansionary and contractionary wavy movements in the aggregate

Causes for diseconomies of scale, Q. Causes for diseconomies of scale? ...

Q. Causes for diseconomies of scale? The most significant cause for diseconomies of scale is the diminishing returns to management. As the output grows beyond certain level the

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