CHAPTER
6a
THEORY OF
FIRM AND
MARKET
STRUCTURE
, Topic Learning
Outcomes
At the end of this topic, student should
be
able :
1.To explain profit maximizing output
and price using total approach
2.To explain profit maximizing output
and price using marginal approach
, Theory of the firm and market
structure
•theory of the firm assumes a firm always
want to maximize profits. If not it will try to
break even or minimize losses.
• when a firm maximizes profits/breaks
even/minimizes losses, it has no desire to
change output and price. Thus it is in
equilibrium.
6a
THEORY OF
FIRM AND
MARKET
STRUCTURE
, Topic Learning
Outcomes
At the end of this topic, student should
be
able :
1.To explain profit maximizing output
and price using total approach
2.To explain profit maximizing output
and price using marginal approach
, Theory of the firm and market
structure
•theory of the firm assumes a firm always
want to maximize profits. If not it will try to
break even or minimize losses.
• when a firm maximizes profits/breaks
even/minimizes losses, it has no desire to
change output and price. Thus it is in
equilibrium.
