Essays Tagged: "Marginal Cost"

A little information about Macro Economics.

tivity.Average cost: the total cost of undertaking an activity divided by the units of the activity.Marginal benefit: the extra benefit from undertaking one more unit of an activity.Marginal cost: the ...

(3 pages) 172 0 3.0 May/2003

Subjects: Social Science Essays > Economics

Microeconomic Theory, Price Policy in Oligopoly.

and hence there is a kink in the demand curve faced by the firm.For straight line demand curves the marginal revenue line lies halfway between the demand curve and the vertical axis. It is thus easy t ... easy to show that the kink in the demand curve implies a discontinuity, i.e. a sudden drop, in the marginal revenue curve of the firm.Marginal cost could thus vary greatly but still pass through this ...

(5 pages) 434 0 3.8 May/2003

Subjects: Social Science Essays > Economics

The use of marginal costing techniques for managerial decision making ignores important commercial factors. Discuss this statement including relevant examples to support your argument.

The cost of a product under marginal costing or variable costing includes only the variable costs of making the product. The var ... lude direct material, direct labour and variable overheads. Variable costs per unit approximate the marginal cost of making another unit of a product. Selling price minus variable costs adds up to con ... bute to profit. The fixed costs are treated as period costs and are expensed in the period incurred.Marginal costing can be used to assist in decision making in the following circumstances: acceptance ...

(2 pages) 21462 0 4.5 Jan/2004

Subjects: Businesss Research Papers > Accounting

Economics MR=MC profit maximizing/loss minimizing

economics, the point of profit maximizing and loss minimizing is called MR=MC. This point is where marginal revenue equals marginal cost, meaning that cost does not exceed revenue and revenue does no ... st away from the total returns. The optimal point of production for the firm is at the point MR=MC. Marginal revenue is defined as the change in total revenue as a result of producing an additional un ...

(3 pages) 18039 0 4.4 May/2004

Subjects: Social Science Essays > Economics

What are the implications for demand in the short and long run of undercharging for road transport?

d to quantify as there are many external costs not considered by an individual when calculating the marginal cost and benefit ratio before undertaking a journey (Parkin. 2000). These externalities inc ... increase the demand for road transport, road space and road maintenance, in the short term, as the marginal benefit of making a journey would become greater than the marginal cost of the journey.Subs ...

(7 pages) 79 0 3.0 May/2004

Subjects: Law & Government Essays

Explain why Siny Plc may attempt to discriminate on price and advise the company on the conditions necessary for implementing the strategy.

Price discrimination can be defined as the differences in the ratio of price to marginal cost across buyers or unit of a good. One form of price discrimination is the practice of a ... rplus in this transaction. If we assume that the firm is a monopolist, its demand curve becomes the marginal revenue curve i.e. it does not have to lower the price to the higher value customers in ord ... nto a peak market with inelastic demand, and an off-peak market with elastic demand. The demand and marginal revenue curves for the peak market and off peak markets are labelled A and B respectively. ...

(10 pages) 119 4 2.0 May/2004

Subjects: Businesss Research Papers > Markets & Exchanges

Balance sheet

and its causes.It is not impossible to account for each and every penny for a company. However, the marginal cost of accuracy rises exponentially. Financial accounting principles recognise that human ...

(4 pages) 230 0 3.0 Feb/2005

Subjects: Businesss Research Papers > Accounting

Industrial Profitability.

g firms in the industry. In some industries firms compete aggressively, pushing prices close to the marginal cost. In other industries firms choose to find ways to coordinate their pricing or compete ...

(2 pages) 26 0 0.0 Sep/2005

Subjects: Businesss Research Papers

Profit maximisation is not the sole objective of business.

e main aims of the firms. The generally accepted view is the long run will wish to maximize profit. Marginal Cost and Marginal Revenue can be used to find the profit maximising level of output. Margin ... aximising level of output. Marginal cost is the addition to total cost of one extra unit of output. Marginal revenue is the increase in total revenue resulting from an extra unit of sales. Economic th ...

(4 pages) 102 0 5.0 Feb/2006

Subjects: Businesss Research Papers

Unitron Corporation: Teaching Commentary

time--"just maximize the total revenue over the batch." Like the comparable adage to "price so that marginal cost equals marginal revenue," the economists' advice about joint costing is certainly accu ... ow percent of total business, this contract seems like a good one to avoid! It only looks good on a marginal cost basis. As noted many times earlier in this book, this author takes the position that " ...

(12 pages) 146 0 2.3 Apr/2006

Subjects: Businesss Research Papers > Case Studies

Barco case discussion

case where Sony was to charge $9,000 for its new 1270 'super data' projector (assuming that 1270's marginal cost is much lesser than $9000). Do you think that Sony can merge the data and the video se ...

(3 pages) 51 0 3.0 Jan/2007

Subjects: Businesss Research Papers > Case Studies


if an appropriate side payment is made. The efficient level of production of any good is where the marginal benefit and marginal cost of the good are equal. Graphical, this is here the marginal cost ... Graphical, this is here the marginal cost curves intersect. In a perfectly competitive market, the marginal cost of a good is given by ate market supply curve, and the marginal benefit of the good is ...

(1 pages) 12 0 1.0 Feb/2002

Subjects: Businesss Research Papers > Management


behavior of oligopolies. Oligopolies tend to achieve inefficient results from setting prices above marginal cost, except in sales maximizing firms, such as the telecommunications industry. According ...

(1 pages) 25 0 5.0 Feb/2008

Subjects: Businesss Research Papers > Case Studies

Market Structure simulation

a monopoly the demand curve is downward sloping so the company must operate at an output where the marginal revenue equals marginal cost. East-West decides to set the price at 7.85 per ton which resu ... n different ways. In a perfect competition market structure it maximizes profits when profits equal marginal revenue and equal marginal costs. In a monopoly the company can maximize profits where marg ...

(3 pages) 94 0 5.0 Sep/2008

Subjects: Businesss Research Papers

East-West Transportation Inc Market Structure Simulation

enue curves faced by the freight transportation company. These cost and revenue curves, consists of Marginal Cost (MC), Marginal Revenue (MR), Average Total Cost (ATC), and Average Variable Cost (AVC) ... mines at this point, East-West Transportation Inc will continue to operate. Maclachlan (2008), "The marginal revenue for a perfectly competitive firm is the market price determined by the intersection ...

(4 pages) 308 0 3.7 Dec/2008

Subjects: Social Science Essays > Economics

How the firm chooses the level of output that maximises profit under perfect competition

etitive market. Firstly, it will define some crucial concepts, such as total cost, average cost and marginal cost in terms of cost. Then, it will apply some crucial concepts to explain why marginal re ... cial concepts to explain why marginal revenue and marginal cost are significant and it will explain marginal revenue in detail, especially under perfect competition. Subsequently, this essay will empl ...

(7 pages) 71 0 5.0 Feb/2009

Subjects: Businesss Research Papers > Markets & Exchanges

Scenario Analysis

Scenario).II.Effect On RevenueIn the initial stages of production, where output is relatively low, marginal revenue will usually exceed marginal cost. So it is profitable to produce through this rang ... r Will is the internet. Because later stages of production, where output is relatively high, rising marginal costs and causes marginal revenue to decrease, the internet will provide a wider range of o ...

(6 pages) 166 0 0.0 Aug/2009

Subjects: Social Science Essays > Economics

Economic Decision Making

ess involved in our decisions and how it affects us. We look for alternatives and we gauge what the marginal benefits would be if certain decisions are made. Economic decisions are made by both young ... n an interest bearing account. The third principle states that rational people will only act if the marginal benefits exceed the marginal cost. The fourth principle states that people will be more lik ...

(3 pages) 48 0 0.0 Oct/2009

Subjects: Businesss Research Papers > Management

Differentiating Between Market Structures

med a monopoly. In such a market, the division has the advantage to set prices at a point where the marginal revenue is equal to the marginal cost. Since a monopoly market does not have competitors an ... ly maximizes it profits by choosing its own costs and output. A monopoly will maximize profit where marginal cost equals marginal revenue or P=MC=MR. The monopolist will produce a profit due to barrie ...

(4 pages) 95 0 0.0 Jan/2010

Subjects: Businesss Research Papers

Supply and Demand and Price Elasticity Paper

individual decision-making. It will also provide an example of a decision in which you compared the marginal benefits and the marginal costs. The paper will explain what incentives could have led maki ... al people think at the margin, means that a rational or typical decision maker will act only if the marginal benefit of the action exceeds the marginal cost. A perfect example of this just happened. I ...

(3 pages) 36 0 3.0 Feb/2010

Subjects: Social Science Essays > Economics