Explain maximising revenue method, Managerial Economics

Assignment Help:

Q. Explain Maximising revenue method?

In a number of cases, a firm's demand and cost conditions are such that marginal profits are greater than zero for all levels of production. In this case, Mπ = 0 rule has to be modified and the firm must maximise revenue. Or we can say the profit maximising quantity and price can be concluded by setting marginal revenue equal to zero. Marginal revenue equals zero when marginal revenue curve has reached its maximum value. An illustration would be a scheduled airline flight. Marginal costs of flying the route are negligible. Airline would maximise profits by filling all the seats. Airline would determine the p-max conditions by maximising revenues.


Related Discussions:- Explain maximising revenue method

Explain about cardinal utility, Q. Explain about Cardinal utility? A me...

Q. Explain about Cardinal utility? A measure of utility or satisfaction derived from consumption of services and goods which can be measured using an absolute scale. Cardinal u

Factors influencing demand for a product, Factors influencing demand for a ...

Factors influencing demand for a product These are broadly divided into factors determining household demand and factors affecting market demand . Factors affecting hou

Nash equilibria of this game, Two competing firms are each planning to intr...

Two competing firms are each planning to introduce a new product. Firm 1 will decide whether to produce product A, product B or product C, while firm 2 can choose between products

State the meaning of managerial economics, State the Meaning of managerial ...

State the Meaning of managerial economics Managerial economics, used synonymously with business economics, is a study of economics that deals with the application of microecono

Price elasticity of supply, Price Elasticity of Supply Price Elasticit...

Price Elasticity of Supply Price Elasticity of supply measures the degree of responsiveness of quantity supplied to changes in  price.  The co-efficient of the elasticity of s

Explain about inventory economies, Q. Explain about Inventory Economies? ...

Q. Explain about Inventory Economies? Inventory Economies: Role of inventories is to aid the firm in meeting random changes in the output and the input sides of the operations

Marris Model, Explaination of the Marris Model

Explaination of the Marris Model

Keynesian unemployment, Keynesian unemployment According to Keynesian ...

Keynesian unemployment According to Keynesian theory of income and employment, unemployment occurs due to lack of effective demand. If effective demand is less, production of

Function and importance, explain the supply function and importance of supp...

explain the supply function and importance of supply analysis in brief

Expected price per product, Airbus Boeing Deman...

Airbus Boeing Demand P = 182.868 - 0.0003Q P = 198.6592 - 0.00013Q TVC Curve TVC = 104.8822Q - 0.001Q^2 + 0

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