Question
MR = P+ [Q x (P/Q)] . The equation has two parts, (1) the price P, and (2) Q x (P/Q). We know that MR
MR = P+ [Q x (P/Q)]. The equation has two parts, (1) the price P, and (2) Q x (P/Q). We know that MR < P, which means that the 2nd part must be negative. Explain what the equation means and why MR < P. [ It might be easier to explain with a numerical example using a simple demand curve like Q = 10 - P.]
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International Business Competing in the Global Marketplace
Authors: Charles W. L. Hill
11th edition
1259578119, 978-1259578113
