Marginal cost Essays

  • Business Case Study: Calyx And Corolla

    762 Words  | 4 Pages

    Name - Mayank Saxena Case write up: Calyx & Corolla Executive Summary: Calyx & Corolla novel approach of selling fresh flowers by mail to consumer has worked wonders not only for them but also for growers and consumers. Ruth Owades provident approach for its business by keeping only three main pillars i.e. growers, Federal Express and Consumers has provided a new vision to the flower industry which benefits everyone and have made Calyx & Corolla one of the most competitive players in the

  • Business Life Cycle Theory

    772 Words  | 4 Pages

    life, the level of the firm's risk is low; it is still likely to attract investors to the realization of new projects. 6. Sustainability: At this stage the company has fewer opportunities for investment, but it has a higher return compared with the cost of capital. This stage is considered the stage of "maturity", but with a marked slowdown in

  • The Pros And Cons Of Predatory Pricing

    840 Words  | 4 Pages

    competitors out of the market and gain monopolistic profits. The logic of predatory pricing is very simple. The predatory firm first lowers its price, to an extent which the revenue of the product does not cover the costs. The competitors must then lower their prices below average cost, thereby losing money on each unit sold. If they do not cut their prices, they will lose competitiveness; if they do cut their prices, they will eventually go bankrupt. (DiLorenzo, 1992) The modern antitrust law intends

  • Microwavable Food Case Study

    1328 Words  | 6 Pages

    In relation to short term run, the price is greater than marginal cost, thus it may not generate profit in the short run. In relation to long run analysis, marginal revenue always equals to marginal cost. In order to become profitable, the price needs to be greater than the average total price cost (Mankiw, 2011). For the company’s price, in the short run, must meet average variable costs and average total cost needs to be met in the long run in order to continue operations. 4. Determine

  • Free Rider Problem Essay

    2109 Words  | 9 Pages

    fully established it has the advantage of the economy of scales. When smaller producers would not even dream to compete with them. The production price drops significantly the more products you produce. The monopoly may drop the price lower then the cost of production for a time and flood the national or even foreign

  • Blackwell Automotive Company Ratio Analysis

    1150 Words  | 5 Pages

    Ratio Analysis of Blackwell Automotive Company BN160722 BUS 550 Financial Management Professor: Dr. Stephen Hawn Westcliff University 19/02/2017 Abstract This study is conducted to analyze the ratio analysis of Blackwell Automotive Company. This study shows the calculation of liquidity ratio of Blackwell Automotive Company in terms of current ratio and quick ratio. This study is conducted to analyze the days’ sales outstanding ratio, total assets turnover ratio and fixed assets turnover ratio

  • Case Study The Law Of Diminishing Marginal Returns

    969 Words  | 4 Pages

    6. The law of diminishing marginal returns means that, at a certain point, hiring an extra factor of manufacture causes a comparatively smaller increase in output. The law of diminishing marginal returns occurs in the short run when one factor is fixed (e.g. capital). If the variable factor of production is increased (e.g. labour), there comes a point where it will turn out to be less profitable and therefore there will eventually be a decreasing marginal and then average product. This is because

  • Personal Narrative: My Brother Of My Life

    769 Words  | 4 Pages

    10 miles. 20 minutes. That is the distance and time it takes to drive a car, at the speed limit, from my house to St. Vincent – St. Mary High School. More importantly, it is the time and distance my brother Griffin Spinner and I drive to school each day. And it is during this time in which I have his attention all to myself. With a brother like Griffin, it is hard to get his attention. Between his commitments to soccer, school, and friends, Griffin is always in high demand. However during

  • Impairment & Company Case Study

    759 Words  | 4 Pages

    the fair value less cost to sell or value in use. Carrying Value of the Goodwill = $250,000 The value in Use can be calculated as follows. Year 1 Year 2 Year 3 Year 4 Year 5 $ $ $ $ $ Cash flows 50,000 50,000 40,000 30,000 20,000 If we use the Current company discount rate then we can get the following answer Discount rate@8% 0.926 0.857 0.794 0.735 0.681 Net Cash flow 46,300 42,850 31,760 22,050 13,620 Total Net Cash flow = $156,580 If we use the weighted average cost of

  • Peter Singer's Argument In Famine, Affluence And Morality

    3128 Words  | 13 Pages

    Philip Manning 12504697 Q) Evaluate Peter Singer’s argument in ‘Famine, Affluence and Morality’. There can be no doubt that Peter Singer’s argument in ‘Famine, Affluence and Morality’ is unrealistic, unfair and not sustainable. Singer’s arguments are valid arguments but not sound. In order to get a clear and balanced view of my arguments which disprove the Singer article, it is first necessary to examine and lay out the main aspects of Singer’s argument in ‘Famine, Affluence and Morality’. My arguments

  • Long Run Average Cost Theory

    1417 Words  | 6 Pages

    Long-run average cost refers to per unit cost incurred by an organization in the production of a desired level of output when all the inputs are variable. The LRAC of an organization can be attained from its short-run average cost curves. Each SRAC curve represents the firm's short-run cost of production when different amounts of capital are used. The shape of the LRAC curve is similar to the SRAC curve while the U-shape of the LRAC is not due to increasing and later diminishing marginal. The -ve slope

  • Cost Reimbursement Contracts

    893 Words  | 4 Pages

    plus additional payment to allow for a profit. The FAR prohibits the use of cost-reimbursement contracts to acquire commercial items. The cost reimbursement contract is considered high risk for the government because of the potential for cost escalation and because the government pays a contractor’s costs of performance regardless of whether the work is completed. The two major reasons for the inability to estimate costs accurately are the lack of knowledge of the work needed to meet the requirements

  • The Pros And Cons Of Natural Monopolies

    1965 Words  | 8 Pages

    characteristics for a monopoly is that the monopoly firm is a price maker because there is lack of competition. This position allows the firm to obtain abnormal profit in the long run when it operates at the profit maximising point, where marginal cost equals marginal revenue. The products in the industry are non-homogeneous and hence, they do not have close substitutes. A monopoly is characterised by asymmetric information. Consumers, who buy the product, do not have the same information as the supplier

  • Advantages Of Accrual Accounting And Cash Flow Accounting

    1332 Words  | 6 Pages

    Accrual accounting and Cash flow accounting are critical factors which contribute to judgments and decision-makings that lead to a successful business. It is debatable whether accrual accounting is preferred to cash flow accounting, while there are some financial economists are in favor of using cash flow basic to report. This chapter will first give a foundation of accrual and cash flow accounting, then discuss the advantages as well as drawbacks of both methods and give the conclusion which type

  • Cost Reimbursement Contracts Case Study

    2224 Words  | 9 Pages

    resources used. the contractor will be paid a fixed price. It is usually a competitive tendering process. Fixed price contract is opposed to a cost-plus contract, which is projected to cover the prices with extra profit made. The contractor will not receive an extra payment for accomplishing higher quality standards. The contractor shall bear all the costs of providing the service or item mentioned in the contract This means that only the contractor who is affected by the losses, which also will

  • Summary Of Goldman Sachs: Power And Peril

    800 Words  | 4 Pages

    Goldman Sachs: Power and Peril I am strongly agree with the action of SEC. The main problem of any financial and banking firm is Asymmetric Information (Adverse Selection and Moral Hazard). Adverse Selection is the risk before the money transaction while Moral Hazard is risk after money transaction. But before going directly into subject, we will understand the element involve in the case. The main role of SEC is to ensure that the stock markets operate in such a direction that it will create fair

  • Cookie's Spread Ratio Analysis

    779 Words  | 4 Pages

    Spread Ratio The magnitude of p-value indicates that linear terms of all the variables have significant effect at 5% level of significance (p <0.05) on cookie’s spread ratio. Further quadratic effect of fat content was significant effect at 5 % level of significance (p<0.05). The magnitude of β coefficients (Table 3) revealed that the linear term of fat (β= 0.24) and AF (β= 0.087) have positive effect; whereas the SMP (β= -0.037) has negative effect on cookie’s spread ratio, which indicates that

  • Case Study: Sport Obermeyer

    796 Words  | 4 Pages

    At the optimal service level (OSL) the expected marginal cost and expected marginal benefit should be equal for a firm (Chopra & Meindl, 2013). At the optimal service level, Expected Marginal Benefit = Expected Marginal Cost The optimal service level of 75% returns a Safety Stock Coverage Factor Z-value as 0.674. We can calculate optimal order quantity for each style of parka as, This

  • Explicit Cost Vs Implicit Cost

    962 Words  | 4 Pages

    In this section, I’ll be explaining the difference between implicit and explicit costs. I will also provide two examples when they differ. An explicit cost is the amount of expenses a business incurs when conducting an activity. This type of cost includes but not limited to salaries, materials, rent and utilities. (Explicit Cost, n.d.). An implicit cost is considered the opportunity cost of an activity. This is when the firm use its own resources to cover the expense of an activity. If the firm

  • Advantages Of Cost Curve

    995 Words  | 4 Pages

    Long run cost curves are U-shaped in light of the presence of economies and diseconomies of scale. Economies of scale are the cost advantages that a firm, or a business when all is said in done, acquires by extending production. At the end of the day, they are spoken to by the diminishment in unit costs over the long run as the extent of the firm – the scale – increases. Diseconomies of scale are the inverse: long-run average costs will in the end start to rise when the measure of the firm turns