Egt1 Task 1

EGT1 Task 1 In this paper I am pass to define a few car park economic terms and explain their relationships to some other economic terms. I pull up stakes in like manner explain how profit maximizing sign of the zodiacs get a line their optimal level of output and how a profit maximizing trusty impart react to different levels of bare(a) taxation. fringy tax tax is the extra revenue that get out be made by a firm when the firm sells one special whole of a harvest-festival. count revenue is precisely the sum of a firms sales of a specified quantity of a point product. So, while bare(a) revenue is cogent how much extra money change each additional product lead make a firm, total revenue is telling how much the firm give make by selling a disposed(p) quantity. Marginal embody is the what it will apostrophize a firm to bring up one more unit of product. Total live is the total economic cost a firm incurs for producing a given quantity of a certain product.P rofit is just now the a firms total revenue afterwards the firm pays for its operating costs, and profit maximisation is the the course of action that a firm takes to determine how much they will cite and what they will charge per unit of end product in order to provide the firm with the greatest possible profit in either the long run or the short run time trap of a firm.A profit-maximizing firm determines its optimal level of out put by finding the point where peripheral cost is refer to marginal revenue. Meaning that, when the cost of producing an additional, or extra, unit of product is equal to the amount of extra revenue. This point is the florescence of the firms profit maximizing potential. An additional unit of product after this point will only result in be the firm money, rendering marginal revenue as zero or negative.If a profit maximizing firms marginal revenue is greater than marginal cost, the firm will continue adding another unit of product to production as long as marginal revenue is greater than or equal to marginal cost. If a profit-maximizing firms marginal revenue is less than marginal cost, the firm would need to reduce its output to the point of optimal output where marginal revenue is again equal to marginal cost. EGT1 Task 1 References McConnell, C. R. , Brue, S. L. , & Flynn, S. M. (2012). Economics principles, problems, and policies. cutting York McGraw-Hill.