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Study Guide

[BUS 207] - Final Exam Guide - Ultimate 32 pages long Study Guide!


Department
Business Administration
Course Code
BUS 207
Professor
Karen Ruckman
Study Guide
Final

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SFU
BUS 207
FINAL EXAM
STUDY GUIDE

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ogurtBUS 207 CHEAT SHEET
Lecture 1
MARGINAL BENEFITS
total benefits of last unit consumed
Goes down w/ more units consumed – diminishing marginal returns
MARGINAL COST
Addition to TC from last unit produce
Always increasing = opportunity cost of leisure forgone
MAX NET BENEFIT (PROFITS)
MB=MC
Derivative of Profit=zero
Lecture 2 - Demand
DEMAND – never goes negative
DETERMINANTS
1. Own price = along.
2. Income = shifts
3. Price of related goods = shifts
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DEMAND FUNCTION VS DEMAND CURVE
Relationship between P&Q and all other demand factors
DC – relationship only between P&Q hold others constant
Z FACTORS
1. Network effects
2. Complements
3. Compatibility
MARGINAL REVENUE MR
MR will always have the double slope of TR (inverse Dc=P= 2+q)
Good = 1 more unit= TR goes up(until you are profit maximizing)
Bad= 1 more unit =Price goes down! = profits go down
MR CAN go negative = when bad outweighs the good
ELASTICITY
To figure out when the bad outweighs the good.
%∆Q or %∆P = dQ or dP (derivative)
1. Own price elasticity: Elasticity at a point = (P/Q)* (dQ/dP)
a. You must know the equations for DC
b. And price (or quantity)
2. Arc Elasticity: elasticity between two point on Dc
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