Marginal Analysis free essay sample

Marginal cost and total cost are related in terms of the cost of production for manufacturing companies or service providers. Fixed costs and marginal variation in cost are both considered when determining the total cost, so total costs encompass marginal costs. C. Profit is the surplus remaining after total costs are deducted from total revenue. 1. 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. D. The monopolist’s profit maximizing level of output is found by equating its marginal revenue with its marginal cost, which is the same profit maximizing condition that a perfectly competitive firm uses to determine its equilibrium level of output. E. To produce more products until the last items produced are at the breakeven point. This means you have maximized your production and profits. F. If the marginal cost is greater than revenues. We will write a custom essay sample on Marginal Analysis or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page You must slow down until the last unit produced is at a breakeven point where as the unit cost equals the revenue for that unit. REFERENCES Wikipedia. org. March 12, 2013. Marginal cost. Retrieved from http://en. wikipedia. org/wiki/Marginal_cost Wikipedia. org. April 3, 2013. Marginal cost. Retrieved from http://en. wikipedia. org/wiki/profit_maximization Cliffsnotes. com. April 25, 2013. Profit maximization. Retrieved from http://www. cliffsnotes. com/study_guide/Profit-Maximization. topicArticleId-9789,articleId-9769. html Answers. yahoo. com. May 14, 2010. Explain what action a profit-maximizing firm takes if marginal revenue is greater than marginal cost. Retrieved from http://answers. yahoo. com/question/index? qid=20100513183336AAuTV5x