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Within economics, margin is a concept used to describe the current level of consumption or production of a good or service. [1] Margin also encompasses various concepts within economics, denoted as marginal concepts, which are used to explain the specific change in the quantity of goods and services produced and consumed.
Thinking on the margin is the key to decision making. When we make decisions, we are making comparisons between alternatives. What opportunity are you giving up? In this lesson Professor List will walk you through decision making like an economist.
Marginal refers to the extra, additional, or next unit of output, consumption, or any other measurable quantity that can be increased or decreased by incremental amounts. There are various marginal concepts such as marginal utility, marginal cost, marginal revenue, marginal product and marginal profit.
In this article we will discuss about:- 1. Meaning of Margin 2. Importance of the Concept of Margin 3. Special Role. Meaning of Margin: In economics, the concept of margin has a great importance. The marginal unit of anything is the unit whose small addition or subtraction is under consideration.
In economics, any decision-making process involves considering the impact of a small or incremental change from the current situation. This is known as marginal analysis. The term ‘margin’ refers to small incremental adjustments to an existing plan of action.
I discuss what we mean by margins in economics, and give some examples of where the margin is used: marginal cost, marginal revenue and marginal product.When...
- 5 min
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- Everything Econ
Jan 22, 2024 · Profit margin is a common measure of the degree to which a company or a particular business activity makes money. Expressed as a percentage, it represents the portion of a...
