Archives: Terms

Definition of Marginal Revenue Product (MRP) Marginal Revenue Product (MRP) is a concept used in economics to measure the additional revenue generated by each additional unit of input, such as labor or capital. It represents the change in total revenue resulting from the employment of one additional unit of input. […]

Definition of Marginal Revenue (MR) Marginal revenue (MR) is the additional revenue generated from selling one additional unit of a product or service. It represents the change in total revenue that occurs when the quantity sold changes by one unit. Marginal revenue is an important concept in economics and business […]

Definition of Marginal Rate of Transformation The Marginal Rate of Transformation (MRT) is a concept in economics that measures the rate at which one good must be sacrificed in order to produce an additional unit of another good, while keeping the total level of production constant. It represents the opportunity […]

Definition of Marginal Rate of Technical Substitution The Marginal Rate of Technical Substitution (MRTS) measures the rate at which a firm can substitute one input for another while keeping the level of output constant. In other words, it represents the amount by which the quantity of one input can be […]

Definition of Marginal Rate of Substitution (MRS) The Marginal Rate of Substitution (MRS) is an economic concept that measures the rate at which a consumer is willing to give up one good in exchange for another while maintaining the same level of satisfaction. It represents the amount of one good […]

Definition of Marginal Propensity to Save (MPS) The Marginal Propensity to Save (MPS) is a measure that indicates how much of an additional dollar of income will be saved instead of spent. In other words, it represents the proportion of a change in income that is saved rather than consumed […]

Definition of Marginal Propensity to Import (MPM) The Marginal Propensity to Import (MPM) refers to the proportion of each additional unit of income that is used to import goods and services from foreign countries. It represents the responsiveness of imports to an increase in income. Example To understand the concept […]

Definition of Marginal Propensity to Consume (MPC) The Marginal Propensity to Consume (MPC) is a concept used in economics to measure the change in consumption that occurs in response to a change in disposable income. It represents the proportion of additional income that is spent on consumption rather than being […]

Definition of Marginal Cost of Production The marginal cost of production is the change in total production cost that occurs when one additional unit of output is produced. In other words, it measures the cost of producing an extra unit of a good or service. It is important for businesses […]

Definition of Marginal Benefits Marginal benefits refer to the additional benefits gained from consuming or producing one more unit of a good or service. In other words, it measures the increase in total satisfaction or value that an individual or society receives from consuming or producing an additional unit. Example […]