Optimal Price Calculator
Parameter | Description | Example Value |
---|---|---|
Marginal Cost | The cost to produce one additional unit of a product. | $15 |
Price Elasticity of Demand | The responsiveness of the quantity demanded to a change in price. | -2 |
Optimal Price | The price at which profit is maximized. It is calculated using the formula: \(\text{Optimal Price} = \frac{\text{Marginal Cost}}{1 + \frac{1}{\text{Price Elasticity of Demand}}}\). | $20 |