Please enable JavaScript.
Coggle requires JavaScript to display documents.
Economics 3.3.1 - Coggle Diagram
Economics 3.3.1
price takers
perfectly competitive markets
no pricing power
take the price of the market
perfectly elastic demand curve
AR = MR
every unit sold is at the same price
TR curve is upwards sloping
maximising revenue
MR = 0
no more revenue can be achieved from producing and selling another unit
PED of AR curve (demand curve) = -1
when MR is +ve, PED is elastic
when MR is -ve, PED is inelastic
price makers
set own prices
imperfectly competitive markets
AR curve (demand curve) is downwards sloping
MR is below AR
revenue
total revenue
income generated from the sale of goods and services in a market
average revenue
demand curve
TR / output
marginal revenue
change in revenue from producing one more unit of a good
twice the gradient of AR