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How do you determine optimum production?
Three important cases: Total productive surplus is maximised at consumer equilibrium. Total profit is maximised when marginal cost = marginal benefit. Social welfare is maximised where marginal social cost = marginal social benefit.
What is the equation for marginal net benefits?
Marginal net benefits= Marginal benefit- Marginal cost
Is the marginal cost the derivative of the total cost?
Yes, the marginal cost is the derivative of the total cost.
What are typical shapes of marginal-benefit curves?
Marginal Benefit curve is usually downward sloping, while Marginal Cost is usually upward sloping.
Marginal cost when buying a house?
marginal cost influences the buyer of the house. If the marginal benefit surpasses or even equal with the marginal cost, the buyer normally decides to buy the house.
How do you determine optimum production?
Three important cases: Total productive surplus is maximised at consumer equilibrium. Total profit is maximised when marginal cost = marginal benefit. Social welfare is maximised where marginal social cost = marginal social benefit.
What is the optimal level of pollution?
when marginal benefit is equal to marginal cost To be more specific: When the marginal damage cost of polluting is equal to the marginal abatement cost of polluting (or the marginal benefit of polluting, which is equivalent to the MAC)
What is the equation for marginal net benefits?
Marginal net benefits= Marginal benefit- Marginal cost
Is the marginal cost the derivative of the total cost?
Yes, the marginal cost is the derivative of the total cost.
What are typical shapes of marginal-benefit curves?
Marginal Benefit curve is usually downward sloping, while Marginal Cost is usually upward sloping.
Marginal cost when buying a house?
marginal cost influences the buyer of the house. If the marginal benefit surpasses or even equal with the marginal cost, the buyer normally decides to buy the house.
A person should consume more of something when its marginal?
benefit exceeds its marginal cost.
When is economic surplus maximized?
when the marginal benefit of consumption is equal to the marginal cost of production.
The marginal benefit of an activity is?
The marginal benefit of an activity refers to the additional satisfaction or utility gained from consuming or engaging in one more unit of that activity. It is a crucial concept in economics, as it helps individuals and businesses make informed decisions by comparing the marginal benefits to the marginal costs. When the marginal benefit exceeds the marginal cost, it is generally advantageous to pursue the activity further. Conversely, if the marginal cost surpasses the marginal benefit, it may be wise to reduce or cease the activity.
When the marginal social cost is greater than the marginal social benefit what happens?
inefficient overproduction
Application of calculus to business decision process?
Microeconomics, which determines much of the business decision process, looks to the margin for much of its data. What is the marginal cost of producing one more piece of output? What is the marginal cost of hiring one more employee? What is the marginal benefit of opening another store? In other words, the business decision process is not concerned with the total cost of producing all its units as much as producing just one more. In this sense, the margin is the derivative of the total cost. When the marginal benefit of something is greater than the marginal cost, the action will be followed. If the marginal cost is greater, it will not be. A company will produce more output until marginal benefit is equal to marginal cost. To maximize profits, the decisions of a company need to be made based upon this knowledge and some very complex calculus to find just want marginal costs and benefits of any given action are.
How will get total cost function form marginal cost function?
Find the integral of the marginal cost.
