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Minimize its loss by producing until MC = MR
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Assume that the price of elasticity demand is -2 for a certain firm's product If the firm raises price the firm's manager can expect total revenue to?
decrease
Why would a firm raise the price of a product after a producer determines that the demand for one of its products is inelastic?
The firm would raise the price because the firm's total revenues would probably increase.
A firm under a perfact competition is a price-taker not price-maker with examples?
it is a price taker because under perfect competition,price is determined by the market(through price mechanism:demand and supply) and not producer.this is because there are so many producers of the same product and all have the perfect knowledge of the market and there is only one buyer of that product,so no body can decide the price of the commodity on behalf of others.thats why a firm under perfect competition is a price taker and not a price maker. As part of the industry, the firm has to simply charge price determined by the industry. If the firm charges more price, it will lose sales and if it charges less price it will incur losses. The typical example of perfect competition is agriculture. The products are indistinguishable. There are many potential suppliers. This makes the farmer a price taker; if he or she prices the product higher than the market price, he or she will not make any sales or make fewer sales, thus incurring loss. Thus the farmer has to go with the price determined by the industry in order to survive
If a perfectly competitive firm's price is above its average total cost the firm?
is earning a profit
Why the demand curve faced by a perfectly competitive firm is horizontal?
The firm at perfect competition faces more than one competitor. All the firms are price taker and they take the market price as given. If one firm wants to sell its output at a pricehigher than the market price, it will sell nothing as buyers will go to the firm offering lower market price. If one firm wants to sell its output at a lower price, it will take the whole market demand for it. At the market price, determined by interactions between sellers, the firms will sell whatever output it wants. So, the firms determine the price and each firm determines its output. So the demand curve will be horizontal.
What is a firm fixed price bid?
This means that the price bid for the contract will (if the winning bid) be the actual price paid by the buyer and cannot change (even if it results in a loss to the seller).
What is a firm estimate?
A firm estimate is an estimate where the buyer is not willing to negotiate the price of an item. When a seller is firm on the price, there is very little you can do.
Assume that the price of elasticity demand is -2 for a certain firm's product If the firm raises price the firm's manager can expect total revenue to?
decrease
What are the factors of price leadership?
1. All firms have different cost condition. 2. There can be more than one leading firm ( oligopoly) & thus come to an agreement to avoid price war 3. Largest firm with lowest cost generally becomes price leader. 4. The lead firm has resource advantage and capable of taking risk both at lower price and higher price through promotional activities. 5. Price leadership may also arise because of asymmetric information and it also breaks because of that and lead firm may lose market share. - by sipra7@yahoo.com
What is price leadership by low cost firm?
Price leadership by low cost firm is what results when a firm determines the prices of services and goods within its sector.
When a firm's expenses are greater than its sales revenue the firm has a?
When a firm spends more than it gains in revenue it is called a LOSS.
The cost of overhead minus the selling price?
The cost of overhead minus the selling price is loss.
When debit amount of profit and loss account is greater than the credit amount you say the firm is in loss but when assets of the firm increases it is taken as debit ac how?
It is gained.
Why would a firm raise the price of a product after a producer determines that the demand for one of its products is inelastic?
The firm would raise the price because the firm's total revenues would probably increase.
What are disadvantages to hiring a consulting firm?
price $$$
How do you calculate cost price when given sell price and loss percentage?
Cost Price=(100/(100-loss percent))* Selling Price
A firm under a perfact competition is a price-taker not price-maker with examples?
it is a price taker because under perfect competition,price is determined by the market(through price mechanism:demand and supply) and not producer.this is because there are so many producers of the same product and all have the perfect knowledge of the market and there is only one buyer of that product,so no body can decide the price of the commodity on behalf of others.thats why a firm under perfect competition is a price taker and not a price maker. As part of the industry, the firm has to simply charge price determined by the industry. If the firm charges more price, it will lose sales and if it charges less price it will incur losses. The typical example of perfect competition is agriculture. The products are indistinguishable. There are many potential suppliers. This makes the farmer a price taker; if he or she prices the product higher than the market price, he or she will not make any sales or make fewer sales, thus incurring loss. Thus the farmer has to go with the price determined by the industry in order to survive
