Concept of Revenue
Ajit Kumar In the context of economics, revenue refers to the total income that a firm receives from its normal business activities or other sources during a specific period, usually measured in…
2023
Marginal Cost
It is the change in total cost from producing an additional unit of output. It is calculated as : MCn = TCn-TCn-1 Output Total fixed cost Total variable cost Total…
Average Variable Cost
Average variable cost is the total variable cost per unit of output. It indicates the cost of variable resources like labour and raw materials, calculated per unit. The following figures…
Average Cost
It is the cost per unit of production. Average Cost (AC) is calculated with the help of the following formula: AC = Total cost/Output unit The average cost has further…
Cost of Production
The expenditure on the inputs of production, both factor and non-factor, for the production of a commodity is called the cost of production. Examples of factor inputs are land, labour,…
Law of Variable Proportion
It states that when more and more units of the variable factors are combined with the fixed factor, the total product will initially increase at an increasing rate, followed by…
TP Total product, MP Marginal product and AP Average product
Total product: It is total output produced by all the units of a variable factor used in the production process along with some portion of the fixed factors. For example,…
Production function
Production function is a concept in economics that describes the relationship between inputs (factors of production) and the output of goods and services. In order to produce any commodity, we…
Consumer Equilibrium
Assumptions of IC Analysis of Consumer’s Equilibrium Two Conditions of Consumer Equilibrium: This condition states that at only the point where IC and budget line are tangent to each other…
Consumer’s Equilibrium
Understanding the law of diminishing marginal utility is crucial for economists and businesses when analyzing consumer behavior, setting prices, and predicting how changes in factors like income or prices might…