WebThe correct answer is maximize Blank 3. The correct answer is l …. Explain why a profit-maximizing firm must also minimize costs. For any given profit maximization requires that the difference between TR and TC be If the firm is not minimizing its costs for any given then profits can be increased for any given revenue amount. WebAug 27, 2024 · Point ‘f’ depicts the maximum difference between TR and TC. Hence, the producer will be at equilibrium at ‘f’. Limitation of TR-TC Approach. This method is unsuitable because: It is a geometric method, and measuring the distance between TR and TC is challenging. Difficulty in measuring the per unit profit and cost from the figure.
In the context of producer
WebThe TAR is based on the manufacturer’s published accuracy specifications for the unit under test versus the manufacturer’s published accuracy specifications for the calibration … According to this approach, the producer’s equilibrium has two conditions: 1. The difference between TR and TC is maximum 2. Even if one more unit of output is produced, then the profit falls. In other words, the marginal cost becomes higher than the marginal revenue if one more unit is produced. In the … See more The primary objectives of a firm are: 1. Achieving a target rate of return 2. Stabilizing priceand profit margins 3. Realizing a target market share 4. Preventing price competition 5. Maximizing sales or … See more The MR-MC approach is derived from the TR-TC approach. The two conditions of equilibrium under the MR-MC approach are: 1. MR = MC 2. MC cuts the MR curve from below See more Producer’s equilibrium is the level of the output of a commodity which gives the maximum profit to the producer of the commodity. A firm is in equilibrium if there is no scope for either increasing the profit income or reducing … See more how to write 3 o\u0027clock
Profit-Maximising Behaviour of a Firm (With Diagram) - Economics …
WebBest Answer. In economics, profit maximization is the short run or long run process by which a firm determines the price and output level that returns the greatest profit. There are several approaches to this problem. The total revenue–total … WebJan 18, 2024 · TR and TC Approach to Maximisation Profit. We know that the profit is nothing but the difference between total revenue and the total cost. Profit maximisation through this approach states that the firm should produce that quantity of output such that the difference between the total revenue \((TR)\) and the total cost \((TC)\) should be … WebThe maximum profit will occur at the quantity where the difference between total revenue and total cost is largest. ... at Q = 60, TR = 240 and TC = 165. The difference is 75, … origins of the word government