3.3 revenues, costs and profits Flashcards
1
Q
what is revenue
A
the income generated from the sale of goods and services in a market
2
Q
total revenue
A
price x quantity
3
Q
average revenue
A
total revenue / quantity
4
Q
marginal revenue
A
change in total revenue / change in quantity
5
Q
what is perfect competition
A
a market structure in which individual firms have no market power due to the amount of competition and are unable to influence price
6
Q
what is imperfect competition
A
a market structure where firms do have some market power and can influence prices
7
Q
explain what occurs when there is perfect competition
A
- firms are price takers
- TR increases at a constant rate
8
Q
explain what occurs when there is imperfect competition
A
- ## firms are price makers
9
Q
A
