Explain Shut Down Price
Explain the term Shut Down Price? Illustrate it.
Expert
Shut Down Price (PSD): In purely competitive firm it is the price at which it loses exactly similar amount of money as if it shut down totally (that is, losing the value of fixed cost). Any price lesser than this is a price at which the firm is fine off shutting down than operating (that is, it will lose less shutting down than generating where marginal revenue equivalents marginal cost). Any price bigger than this and the firm is fine off operating than shutting down in short run, even when it is making a loss. The shut down price is at minimum point on the average variable cost (AVC) curve, or PSD = minimum AVC.
discuss with the help of IS-LM model why money has no effect on output in classical supply case
I have a problem in economics on Price ratios and marginal utility ratios. Please help me in the following question. The efficiency in consumption needs equality of: (i) Income distribution. (ii) All product price and resources. (iii) MC and MR. (iv)
What must be added to NNPMP to obtain net national disposable income? Answer: The Net current transfers from abroad must be added to NNPMP to get national disposabl
Why the value of MPC is not greater than 1? Answer: This is because change in consumption can never be more than change in income.
What are the “powers of the Federal Reserve
Suppose the value of exports of goods of a country is Rs. 1,000 crores and the value of imports of goods is Rs. 1,200 crores, what will be the trade balance (or balance of trade)?
What is the impact on income or output and price of excess demand (Inflationary gap)? Answer: In the condition of excess demand (that is Inflationary gap) there wil
Describe why businessmen mostly wish to open current account in bank?
If households become more willing to hold less cash and more stocks or bonds, the
Define bank rate policy? How does it operate as a technique of credit control? Answer: Bank rate is the rate at which the central bank provides loans to the commerc
18,76,764
1926407 Asked
3,689
Active Tutors
1423477
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!