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The relationship between price and quantity demanded holds true so long as it is complied with the ceteris paribus condition "all else remain equal" quantity demanded varies inversely with price when income and the prices of other goods remain constant. [3] If all else are not held equal, the law of demand may not necessarily hold. [4]
There is a close relationship between any inverse demand function for a linear demand equation and the marginal revenue function. For any linear demand function with an inverse demand equation of the form P = a - bQ, the marginal revenue function has the form MR = a - 2bQ. [6]
Profitability index (PI), also known as profit investment ratio (PIR) and value investment ratio (VIR), is the ratio of payoff to investment of a proposed project.It is a useful tool for ranking projects because it allows you to quantify the amount of value created per unit of investment.
[1] This method is an extension of the economic order quantity model (also known as the EOQ model). The difference between these two methods is that the EPQ model assumes the company will produce its own quantity or the parts are going to be shipped to the company while they are being produced, therefore the orders are available or received in ...
If the original random variable X is uniformly distributed on the interval (a,b), where a>0, then the reciprocal variable Y = 1 / X has the reciprocal distribution which takes values in the range (b −1,a −1), and the probability density function in this range is =, and is zero elsewhere.
The variable y is directly proportional to the variable x with proportionality constant ~0.6. The variable y is inversely proportional to the variable x with proportionality constant 1. In mathematics, two sequences of numbers, often experimental data, are proportional or directly proportional if their corresponding elements have a constant ratio.
In order to perform a profitability analysis, all costs of an organisation have to be allocated to output units by using intermediate allocation steps and drivers. This process is called costing. When the costs have been allocated, they can be deducted from the revenues per output unit. The remainder shows the unit margin of a product, client ...
As the income of the consumer rises, and the consumer chooses X 0 instead of X ' i.e. if the consumer's indifference curve is I 4 and not I 2, then the demand for X 1 would fall . In that case, X 1 would be called an inferior good i.e. demand for good X 1 decreases with a rise in income of the consumer. Thus, a rise in income of the consumer ...