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Establish the relationship between average revenue and marginal revenue and elasticity of demand?
Wiki User
∙ 11y ago
Price elasticity of demand is defined as the measure of responsivenesses in the quantity demanded for a commodity as a result of change in price of the same commodity.In other words, it is percentage change in quantity demanded as per the percentage change in price of the same commodity. In economics and business studies, the price elasticity of demand (PED) is a measure of the sensitivity of quantity demanded to changes in price. It is measured as elasticity, that is it measures the relationship as the ratio of percentage changes between quantity demanded of a good and changes in its price. Drinking water is a good example of a good that has inelastic characteristics in that people will pay anything for it (high or low prices with relatively equivalent quantity demanded), so it is not elastic. On the other hand, demand for sugar is very elastic because as the price of sugar increases, there are many substitutions which consumers may switch to.
In microeconomics, Marginal Revenue (MR) is the extra revenue that an additional unit of product will bring. It can also be described as the change in total revenue/change in number of units sold.
More formally, marginal revenue is equal to the change in total revenue over the change in quantity when the change in quantity is equal to one unit (or the change in output in the bracket where the change in revenue has occurred)
This can also be represented as a derivative. (Total revenue) = (Price Demanded) times (Quantity)
Wiki User
∙ 11y ago
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Relationship between marginal cost and average total cost?
The cost curves best tells us the relationship between the marginal cost and average total cost. The average fixed cost (AFC) curve will decline as additional units are produced, and continue to decline.
What is the relationship between Average variable cost Average fixed cost and marginal cost?
we can subtract the AVC and we will get the MC
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.
How do you find marginal average cost?
Marginal cost comes from the costs of producing just one more of something.
What relationship is shown by a supply curve?
What is shown by a supply curve, is the marginal cost of the company that you are considering, from the point it crosses the average costs function.
Importance of calculus in business?
Some of the business applications are: (1) Finding the number of ouputs produced to maximize the profit. (2) Calculation of marginal revenue , marginal cost (3) Calculation of marginal average cost (4) Calculating elasticity of demand
Draw a diagram with marginal product and average productExplain the relationship between marginal product and average product?
Marginal product is any input in the production process is the increase in the quantity of output obtained from on additional unit of the input. Average product is the output produced when one more unit of the variable factor is employed The relationship is state as: If labour's marginal product is exceed its average product that means labour's average product will be rising. Labour's average product will be falling. If labour's marginal product is less than its average product. If labour's marginal product is equal its average product and the average product will reach the minimum value at the point.
Relationship between Tota Product Marginal Product and Average Product?
Average Product = (Total Product) / (Labor) Marginal Product(2) = (Total Product)(2) - (Total Product)(1)
Relationship between marginal cost and average total cost?
The cost curves best tells us the relationship between the marginal cost and average total cost. The average fixed cost (AFC) curve will decline as additional units are produced, and continue to decline.
What is the relationship between Average variable cost Average fixed cost and marginal cost?
we can subtract the AVC and we will get the MC
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.
How do you find marginal average cost?
Marginal cost comes from the costs of producing just one more of something.
What is the relationship between marginal product and average product?
1.when tp increases mp decreses. 2.when tp is at his highest point, mp is 0. 3.when tp decreses ,mp becomes negetive. and i have no idea what im talking abouT its dumb they should just give it to guys!
What relationship is shown by a supply curve?
What is shown by a supply curve, is the marginal cost of the company that you are considering, from the point it crosses the average costs function.
What Relation between marginal cost and average cost?
relation ship between average cost and marginal cost
What is the relationship between marginal cost and average cost curves?
Margianal cost curve crosses the average total cost curve at the lowest point on the average total cost curve to be socially and ecomonical efficient.
Does marginal cost curve always intersect the average cost curve at the average cost curve's lowest point?
When the marginal cost is below the average total costs or the average variable costs,then the AC would be declining.When marginal cost is above the average cost then the average cost would be increasing.Therefore the marginal cost should intersect with the average cost at the lowest point in order to pull the average cost upwards.
