RE: 11-04-2024 - Economy - Revenue maximization - graph [EN]-[IT]
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It’s good to know about the rules of price elasticity
Thanks for the lecture!
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You are viewing a single comment's thread:
It’s good to know about the rules of price elasticity
Thanks for the lecture!
Hi @rafzat , thanks for stopping by. In summary we could say the following:
When the price elasticity is =1 we will have that R', the marginal revenue is =0 -
When the price elasticity is less than 1 (inelastic zone) and we will have marginal revenue R'<0 while total revenue RT<0.
When the price elasticity is greater than 0 (elastic zone), the price is higher and consequently we will have revenue R>0 and total revenue RT>0.