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What is the relationship between price elasticity of demand and the monopolist's revenue?
marginal revenue is negative where demand is inelastic
Where is lake maricibo?
with example explain the concept of of elasticity of supply and interpretating the result graphical and descuse the relationship between price elasticity and suppliers total revenue
How to use the concept of price elasticity of demand to maximize revenue?
Price elasticity of demand is a way to determine marginal revenue. Optimal revenue and, more importantly, optimal profit will occur to the point when marginal revenue = marginal cost, or the price elasticity of demand < 1.
How does elasticity of demand influence tax revenue?
Elasticity of demand influenced tax revenues
What is the connection between elasticity and total reveneu?
The connection between elasticity and total revenue lies in how changes in price affect consumer demand. When demand is elastic, a decrease in price leads to a proportionally larger increase in quantity demanded, resulting in higher total revenue. Conversely, if demand is inelastic, a price decrease results in a smaller increase in quantity demanded, causing total revenue to decline. Therefore, understanding the price elasticity of demand helps businesses optimize pricing strategies to maximize total revenue.
Is it always true When demand elasticity is equal to -1 marginal revenue is equal to 0?
Yes, when demand elasticity is equal to -1 (unitary elasticity), marginal revenue is indeed equal to 0. This occurs because, at this point, any change in quantity sold does not affect total revenue; increases or decreases in quantity will offset price changes, resulting in no net change in revenue. Thus, when elasticity is -1, the firm maximizes total revenue, leading to marginal revenue being zero.
What will be the elasticity when marginal revenue is zero?
unit elastic
What is the total revenue test for elasticity?
I assume that when you say "elasticity," you mean "price elasticity of demand."Raise price a little. If total revenue goes up, you're in the INELASTIC region (where absolute value of elasticity is greater than 1). If it goes down, you're in the ELASTIC region.
What is the relationship between total average and marginal revenue under monopoly with the help of schedule and diagram?
Total average pertains to annual revenue. While marginal revenue is equivalent to quarterly profits. The relationship between the two is only that one is the dividend of the other.
What is the relationship between price and marginal revenue in a competitive market?
In a competitive market, the relationship between price and marginal revenue is that they are equal. This means that the price of a good or service is equal to the marginal revenue generated from selling one more unit of that good or service.
How did the American revenue act affect the relationship between England and the colonies?
How did the American Revenue Act affect colonial economies?
How revenue method applied in calculating price elasticity of demand?
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