My Math Forum Demand Curve & Marginal Revenue

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November 8th, 2013, 04:33 AM   #1
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Demand Curve & Marginal Revenue

Hi all,

I've been trying for weeks now to get my head round marginal revenue, cost, profit and still my head is struggling grasp something that appears so basic - I need your help!

I'm currently trying to create a couple of graphs:

1. One representing the demand & marginal revenue curves.

2. Another representing marginal cost, revenue & profit.

can anybody help?

I'm a complete novice at this, so please bare with me... But what I've managed to do so far is:

1. One the demand and marginal revenue curve is create a graph using the formula: Q = a minus bP

What I'm struggling with is what is the value of "b"? Currently I've set it at 5, but is this right when a = 1 and P = 0.013?

P.S. to create the graph using a spreadsheet I'm struggling the get the quantity figures to show on the x-axis, does anyone know how?

2. For the marginal cost, revenue & profit graph I've used the basic formulas I've found on the internet but I still don't think my graph is right as it all appears jagged and not smooth - please see the picture attached.

Does this look right to anyone and can anyone explain to me why the marginal cost dips the marginal revenue & marginal profit increases dramatically?

Thanks in advanced for your help on this, it will be greatly and deeply appreciated,
Matt.
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November 8th, 2013, 06:46 PM   #2
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Re: Demand Curve & Marginal Revenue

You're trying to find
Quote:
 Originally Posted by matt-taylor 1. One representing the demand & marginal revenue curves. 2. Another representing marginal cost, revenue & profit.
but I'm not clear on what you've been given. Do you have a table of values? An equation? A series of points? Something else? What values do you know?

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