Cost and Revenue Curves

Cost and Revenue Curves Chito Paulo ECO 561 November 16,2012 George Sharghi Cost and Revenue Curves Every alignment is concern about the good bottom line because it debates the society can sustain successful operation. The management determines strategy and methods to maximize the economic benefit or to minimize economic s conductding of the company. One turn up is to determine the output and set direct and comparing the marginal comprise and marginal tax revenue with application of the marginal cost (MC) marginal revenue (MR) onward motion (McConnell, Brue, & Flynn, 2009).  This approach is based on the fact that when MC = MR (which is shewd as the foreland of intersection of the curves) the economic addition reaches its maximal reconcile or minimum loss. The simulation on cost and revenue shows the interrelationship between the marginal cost and marginal revenue, and new(prenominal) factors that second a manager mak e rational decisions to maximize profits. The interrelationships were pictured in each of the scenario in the simulation. The first scenario involves choosing a verbalize to make up the product that provides the greatest financial and operative benefits.

A manager can make this decision by analyzing the behavior of the MC-MR curve and determining the point of greatest profit (MC=MR). The comparison between Florida and calcium using the MC-MR curve indicate that California is a better place to flummox chromatic juice. At point MC=MR the FarmFresh Company can produce more orange juice and realize a uttermost pro fit compared to MC=MR of Florida. This resul! t is the effects of cheaper prices of orange, concerns for environment conduct to more efficient operation and reduction in cost, etcetera In scenario two, the prices of orange send packingped. The price drop allowed the company in California to produce more orange juice. The price drop government agency the company has a new cost structure. On this situation, the point MC=MR moved to the right exhibit that as the prices of...If you exigency to get a full essay, rear it on our website: OrderCustomPaper.com

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