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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]
In mathematical terms, if the demand function is = (), then the inverse demand function is = ().The value of the inverse demand function is the highest price that could be charged and still generate the quantity demanded. [3]
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 ...
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.
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.
That is, the price margin compared to marginal cost for good is again inversely proportional to the elasticity of demand. Note that the Ramsey mark-up is smaller than the ordinary monopoly markup of the Lerner Rule which has k = 1 {\displaystyle k=1} , since λ = 1 {\displaystyle \lambda =1} (the fixed-profit requirement, Π ∗ = R − C ...
Sales of 300 € minus costs of 275 € gives a profit of 25 €. 25 € in relation to an initial capital investment of 500 € gives a rate of profit of 5 %. From year to year capital can grow at a rate of 5%, if all profits are invested or accumulated.
F/x p • (g 0 —g 1) The model form with 'q' and 'x' in place of' g 0 and g 1 allows profits to be calculated when only the sales and production figures are known. A spreadsheet could be prepared for a company with increasing then decreasing levels of sales and constant production. It could have another column showing profit under increasing ...