Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
NORMAL AND SUPERNORMAL PROFITS
Normal profit refers to the payment necessary to keep an entrepreneur in a particular line of production.
In economics, it is generally believed that any capital invested in business has an opportunity cost. The business must offer the investor a prospective return on capital at least equal to the return available on the next best alternative.
The minimum return required to keep an entrepreneur in a particular line of production is what economists call Normal Profits. Since it represents the opportunity cost of risk capital to the business it is treated as part of the firm's fixed cost which have to be paid if the firm is first to come into existence and then survive in the long run. Normal profits, therefore are included in the calculations which produce the AC curve. Therefore, when price exceeds average cost, the firm is said to be earning abnormal /supernormal profits - it is earning a surplus over and above what is necessary to keep it in that business (the surplus is often referred to in economics as Economic rent).
Q. Proportion of Income Spent on a Commodity? Another characteristic that has an impact on the elasticity of demand for a commodity is proportion of income that consumers use u
what is objective
Explain the short-run production function with one variable input with the help of assumed figures. Clearly indicate the three stages of physical product, using table and graphs.
encrimetal concepts
Suppose that the price elasticity of demand for cereal is -0.75 and the cross-price elasticity of demand between cereal and the price of milk is -0.9. If the price of milk rises by
Q. What do you mean by Cost Function? Cost function is a derived function. It's derived from the production function that describes the efficient method of production at any gi
Monetary policy The problems concerning the ability of monetary policy to influence the economy, as for instance the doubts about the ability of lower interest rates to st
a) In 1948, the money GNP was $520 billion and the price index was 120. In order to make the 1948 GNP comparable with the base year, the 1948 GNP must be adjusted to:
isoquant and its properties
Managerial Economics helps create utility for the Society.
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd