Thursday, September 21, 2006

Lesson 1

ok..from now on i shall educate u ppl on things i have learned in my class
hahaha....

first lesson today....performance management...

profit maximisation => MR = MC

P = a - bQ

to reach MR = MC,
TR = P x Q
TR = (a x bQ) x Q
TR = aQ - bQ²

therefore,
MR = dTR/dQ = a - 2bQ

TC = VC + FC
TC = c + dQ

therefore,
MC = dTC/dQ = d

so Q = (a - d) / 2b


and do you know that breakeven = ax² + bx + c = 0 ?

x = (-b ± √b² - 4ac ) /2a

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