|
What is the definition of 'surplus of revenue'? My textbook's explanation of revenue doesn't cover this. For some context, here is a question from my textbook:
|
||||
|
Simply, this is the amount over which a business is willing to accept for a product. Put another way, if the market price is £10, but you are willing to accept a price of £5, because that covers your costs and gives you reasonable margin, your surplus of revenue is £5, as long as you charge £10. In this case you might only charge £8 or £9, just so you can price under market, and still have a surplus of revenue. The ideal is to maximise surplus of revenue, as that's money that's theoretically "on the table" For more information check out: http://www.amosweb.com/cgi-bin/awb_nav.pl?s=wpd&c=dsp&k=producer+surplus |
|||
|
|
revenue - costs > 0. Secondly this question doesn't appear to be compliant with FAQ and should be closed. – Karlson Nov 15 '12 at 17:33