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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.
Equilibrium Income In this model, aggregate desired expenditure has three components: Consumption, Investment and Government Expenditure:
calculate point elasticity of demand for demand function q=10-2p for decrease in price from rs 3 to rs 2
Demand Function for Money In the Keynesian analysis , the demand for money is a function of the level of income and the rate of interest. According to Milton Friedman, the dema
#queCase Study Labor standards Geeta & Company has experienced increased production costs. The primary area of concern identified by management is direct labor. The company is co
Using the discounting principle calculate the present value of an annuity of five years at Rs. 500 payments made at the end of each of the next five years at 10% interest. stion..
A promoter decides to rent an arena for concert. Arena seats 20,000. Rental fee is 10,000. (This is a fixed cost.) The arena owner gets concessions and parking and pays all other e
examples
Explain baumol''s static model
Q. What do you mean by Oligopoly? Type of market condition that is most appropriate in the today's economy, is oligopoly. It's characterised by mutual interdependence among a f
How does economic theory contribute to managerial decisions?
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