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Q. Show the Changes in fixed costs and profit maximisation? A firm maximises profit by operating where marginal revenue equals marginal costs. A change in fixed costs hasn't an
Prices of other goods must remain constant Changes in the prices of other goods frequently impinge on the demand for a particular commodity. If prices of commodities for which
Other Determinants 1. Rate of Interest Is contained in the argument of the classified economists who argued that rational consumers will save more and consume les
Q. Explain about Linear Isoquant? : In this case, isoquant would be straight lines as in Figure below. This type presumes perfect substitutability of factors of production. I
THE KEYNESIAN THEORY OF CONSUMPTION FUNCTION The theory was developed during the Great Depression which plagued Europe and America. During this time, there was excess capacit
Describe the Application of economic theories Pertinent business decisions necessitate an unambiguous understanding of the environmental and technical conditions under which bu
break event point
The gap between theory and practise and the role of managerial economics: We have noted above that application of theories to the process of business decision making contributes a
Define the Managerial economics Managerial economics is thus a study of application of managerial skills in economics. It assists in determining, anticipating and resolving po
Fixed costs are those that are independent of output. They should be paid even if firm produces no output. They wouldn't change even if output changes. They remain fixed whether ou
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