This Presentation is for education Purpose. Please Be free to suggest any changes. This presentation can clear the concept of Profit Maximization. thank you..
2. profit maximization is the short run
or long run process by which a firm
determines the price and output level
that returns the greatest profit.
3. Increasing Quantity of Production
Decreasing Cost of Production
Changing the Quality of the product
Profit = Total revenue-Total cost
4. Marginal cost/
marginal revenue
Marginal cost is the increase
in total cost from
producing one additional
unit.
The marginal revenue is the
increase in revenue from
the sale of one additional
unit.
Total Cost /
total revenue
Total profit equals total
revenue minus total cost.
5. Profit = TR - TC
Where TR = Total Revenue
TC = Total Cost
Example: If the value of a book is $10 and total
production cost is $7. Then , the profit will be $3
To increase the Profit , we can Increase the
sales value or decrease the Production or
other costs like advertisement costs.
6. Good for institutional
goodwill
Good for investors
Instant good profits
Market value
Not futuristic
Not always good for the
wealth of institution
No longtime profits
Fluctuations in profits
are the sign of unhealthy
institution.