Marginal optimization

Fund Raising at the Margin (9/22/2006)

The MR = MC profit maximization rule could be applied to fund raising.

Keywords: fixed cost, marginal cost, marginal revenue, MC, MR, profit

Marginal Revenue of Perfect Price Discriminators (11/17/2007)

The marginal revenue of perfect price discriminators is equal to price.

Keywords: economic surplus, efficiency, marginal revenue, marginal willingness to pay, MR, MWP, P, perfect price discrimination, price, profit maximization, reservation price, total willingness to pay, TWP

Marginal Revenue under Single-pricing - Price Searchers vs Price Takers (11/17/2007)

Single pricing leads to P = MR under price taking or P > MR under price searching.

Keywords: economic surplus, efficiency, price searching, price taking, profit, reservation price, single pricing, single-pricing

Maximization and Optimization at the Margin (7/7/2006)

Optimizing at the margin can bring about static economic efficiency.

Keywords: average benefit, entry, margin, marginal benefit, marginal cost, marginal revenue, Maximization, MB, MC, MR, optimization, pollution, profit, single pricing, tragedy of the commons

Price Searchers, Price Discriminators, and Price Takers (9/19/2006)

The uniqueness of products affects the pricing power of sellers.

Keywords: output, price discriminator, price searcher, price taker, profit, reservation price

Pricing and economic surplus (7/7/2006)

Pricing affects how economic surplus is distributed between consumers and producers and thus the incentive and resources to come up with innovative products.

Keywords: commodity, consumer surplus, economic surplus, innovative products, marginal cost, marginal revenue, monopoly, perfect competition, price discrimination, reservation price, single pricing

Pricing to Cost - But Which Cost? (10/13/2007)

Pricing to marginal cost may not cover fixed cost.

Keywords: consumer surplus, economic surplus, fixed cost, marginal cost, perfect competition, perfect price discrimination, price searcher, price taker, profit, two-part pricing, variable cost

Profit Maximization - Total vs Marginal (11/17/2007)

Profit maximization can be characterized with reference to the total revenue and total cost curves or the marginal revenue and marginal cost curves

Keywords: fixed cost, marginal cost, marginal revenue, profit maximization, total cost, total revenue, variable cost

The Tyranny of Small Decisions (8/13/1999)

Decisions that are small in size, time perspective, and in relation to their cumulative effect may lead to suboptimal resource allocation.

Keywords: airplane, alternatives, automobiles, cars, commuting, market failure, market imperfection, railroad, size, small decisions, time perspective, tyranny

Untangling Marginal vs Average Value (9/22/2006)

When average value is falling, marginal value is below it. And when average value is rising, marginal value is above it.

Keywords: average cost, average grade, marginal cost, marginal grade