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16 Cards in this Set
- Front
- Back
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Marshals elasticity of demand |
E=change in quantity * price Change in price * quantity |
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Types of demand |
1 individual & market demand 2 derived &direct demand 3 total market demand & market segment demand 4 short run demand & long run demand 5 industry demand & company demand 6 price demand 7 income demand 8 cross demand |
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Relationships of MR & AR when average revenue is falling |
so long as the AR is falling MR falls more sharply than AR MR will be lower than average revenue as long as MR is + Total revenue will increase when MR is 0 Total revenue is max when MR is negative total revenue falls |
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types of production function |
1 fixed proportion production function 2 variable proportion production function ( isoquant) 3 linear homogeneous production function 4 cobb - douglass production funtion |
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iso quant |
it shows the possible combinations of capital & labour that result in same quantity of production |
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types of isoquants |
1 linear isoquant ( perfect substitutability in factors of production) 2 right angled isoquant ( zero substitutability) 3 kinked isoquant ( substitutability of factors) 4 convex isoquant ( substitutability of capital & labor over a certain range) |
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types of economies of scale |
1 Internal or Real economies 2 external or Percuniary economies |
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opportunity cost |
loss of earnings due to loss of earnings |
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marginal cost |
cost of production of an additional unit MC = incremental cost/ additional output |
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can MC curve be rising when AC is falling |
yes before the point of intersection |
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break even point |
is when total cost equals total selling price |
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break even point (in sales) |
= fixed cost * selling price/ selling price - variable cost = fixed cost/ PV ratio |
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calculate of sales volume to produce a desired profit |
= fixed expenses + profit sales price per unit- variable cost per unit |
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calculate sales volume for desired profit per unit |
= fixed expenses selling price -( variable cost + desired profit per unit) |
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volume required to meet additional expenditure |
= proposed expenditure selling price- variable cost |
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sales volume required to offset price reduction |
= fixed expenses + profit new selling price + variable cost |
