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That might be how the free market is explained to a tenth grader, but it's not remotely the full picture. - Do you spend on production or ramp up marketing ins
by wyattpeak 8y ago
That might be how the free market is explained to a tenth grader, but it's not remotely the full picture.
- Do you spend on production or ramp up marketing instead?
- Do projections support taking out a loan to expand future production?
- Do you have other products where your capital would be better directed?
- Is there a point where marginal cost exceeds sale price?
The list of further considerations is endless. Nobody is just blindly producing as much as possible.
- hexane360 8y agoIt's definitely not how it's explained to a tenth grader. In high school economics classes I was definitely introduced to marginal cost curves for firms in perfectly competitive markets, like so: https://upload.wikimedia.org/wikipedia/commons/4/43/Economics_Perfect_competition.svg https://upload.wikimedia.org/wikipedia/commons/4/43/Economic...