Illustrate about pecuniary economies, Managerial Economics

Assignment Help:

Q. Illustrate about Pecuniary economies?

Pecuniary economies (which is monetary economies) are those economies accrued by the firm from paying lower prices for the factors used in distribution and production of the product because of bulk buying by the firm. They add to the firm on account of discounts it can attain because of its large scale production. They decrease the money costs of the factors for a particular firm.

Pecuniary economies are realised by a firm in the following ways:

  • The firm would be able to get raw materials at lower prices owing to bulk buying.
  • A large firm can get funds at lower cost which is at a lower rate of interest because of its reputation in the money market.
  • The large firm may be given lower advertising rates if they advertise at large.
  • Transport rates can be also low if the amount of commodities transported is large.

 


Related Discussions:- Illustrate about pecuniary economies

Weighted-average costing - normal and abnormal spoilage, Weighted-average c...

Weighted-average costing: Normal and abnormal spoilage Ranka Company manufactures high-quality leather products. The Company's profits hav declined during the past 9 months. R

The results of the hypothesis test, Use the data set cd costs2010 to estima...

Use the data set cd costs2010 to estimate the marginal cost of one more CD. (Regress costs on the number of CDS.) Test the hypothesis that the marginal cost equals 75 cents. How wo

International liquidity, INTERNATIONAL LIQUIDITY International liquidi...

INTERNATIONAL LIQUIDITY International liquidity is the name given to the assets which central banks use to influence the external value of their currencies.  It can also be

Determinants of price elasticity, Discuss the determinants of price elastic...

Discuss the determinants of price elasticity of demand

Economics, What limitations are inherent in the economist’s view of pricing...

What limitations are inherent in the economist’s view of pricing?

Evaluate total cost - fixed and variable, Q. Evaluate Total Cost - Fixed an...

Q. Evaluate Total Cost - Fixed and Variable ? Total cost (TC) of the firm is a function of output (q). It would increase with the increase in output, which is, it differs dire

Direct intervention of government in economy, Direct intervention   T...

Direct intervention   The government can also intervene directly in the economy to see that its wishes are carried out.  This can be achieved thorough: a.     Price and i

Define thevariable factor of production, Define theVariable factor of produ...

Define theVariable factor of production The input level of a variable factor of production can be diverse in the short run. Raw material inputs are believed as variable fact

Price under monopoly, The aim of monopolist is to maximise profit therefore...

The aim of monopolist is to maximise profit therefore; he would produce that level of output and charge that price which gives him maximum profits. He would be in equilibrium at th

Individual firm and market supply curves, Individual firm and market supply...

Individual firm and market supply curves The quantities and prices in the supply schedule can be plotted on a graph. Such a graph is called the firm supply curve. A fir

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