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Dear sir,
Profits are maximised when
Marginal cost = Marginal revenueWhat does this means??
Can you provide the calculation??Thanks.
Regards,
LeornadoIt’s F5 material. It is rather theoretical as most organisations won’t know what their marginal revenue is.
Provided each extra unit made and sold has a marginal revenue(=extra revenue) greater than it’s margnal cost (=extra cost) then a positive contribution will be made making and selling that unit.
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