The first is that the marginal cost of such products is close to zero.
Or if you prefer, the marginal cost of one more unit of production is near zero.
As gold prices rose, less efficient mines became viable and drove up the marginal cost of production.
Almost every market for technology products or services in China is oversupplied and many firms price below marginal cost.
FORBES: The China Paradox, Part 2: The Trouble With Going Global
Marginal cost begins to exceed average cost, creating a profit margin despite competitive pressure to price to marginal cost.
As gold declines in price, the least viable mines will be the first closed and bring down the marginal cost.
The information economy is characterized by low to zero marginal cost of information once the fixed cost has been incurred.
FORBES: Why Fixing America's Schools Means Increasing Teacher Productivity
Companies like DigitalGlobe and GeoEye are capturing massive quantities of global sensor data and making it commercially available at marginal cost.
Under pure competition, it is rational for carriers to generate incremental revenue by setting fares only slightly above their marginal cost.
All intellectual property violates the efficiency rule that price should equal marginal cost of reproduction, which for knowledge is nearly zero.
Unfortunately, those fares are below average cost, which is higher than marginal cost due to the spreading of the huge fixed costs.
Remember, the marginal cost to a network of either a new customer or more data for an existing one is essentially zero.
Or rather, to be more accurate, the marginal cost to the consumer closer to the marginal cost of production for the producer.
FORBES: Insane Calculation: It Costs More To Send A Text Next Door Than To Mars
They all face roughly the same (world) demand curve, but each country will have a different marginal cost for getting the oil out.
This contributes no profit on the first visit unless the marginal cost is very small or the discounted product pulls through other profitable sales.
Trading apples for oranges in this case, HFC for CO2 undermines the purpose of the credit-trading scheme: to encourage emissions reductions at the lowest marginal cost.
Moreover, CMS chooses as the final price the median among the winning bids, instead of marginal cost, which would drive pricing in a competitive market.
FORBES: The Federal Government's Deeply Flawed System For Controlling Medicare Costs
However, aside from copper, many of the base metals have already fallen near their marginal cost of production, which should provide a floor, Bhar added.
Gold could potentially overshoot the declining marginal cost to the downside.
The last the lumping together of lots of small trades has put pressure on fees by cutting the marginal cost of a trade, in effect to zero.
The economics of the vaccine industry, he points out, are much like those of software: the marginal cost of each new product is very small.
On the pricing side, too few companies use marginal cost pricing.
Economic theory says that in a competitive market, the cost of a pizza, like the cost of a copyrighted work, will fall to its marginal cost.
FORBES: Libertarians for Central Planning, at Least for Copyrighted Works
His conclusion: Disney should charge what the traffic will bear at the gate, then cut the price of individual rides down to their (very low) marginal cost.
The more members we have the better the prices we can get: the marginal cost of a new member is the cost of printing his membership card.
Platinum is likely approaching the so-called marginal cost of production, which can trigger output cuts in any commodity, said David Wilson, director of metals research at Societe Generale.
FORBES: Analysts: Too Soon For Platinum Tumble To Hurt Output, But 'Something...To Keep An Eye On'
Some of these books are priced significantly above marginal cost.
FORBES: Libertarians for Central Planning, at Least for Copyrighted Works
If water is priced below marginal cost, the makers of bathroom fixtures (among others) will lack adequate incentives to invest in new technology to make their appliances more efficient.
Since then, the cost per child has been set at the marginal cost of an additional bedroom, lowering the housing cost by between 22% and 45%, depending on the region.
Even domestic rivals notably second-placed Edison (currently for sale) and Italy's municipal companies can produce electricity at a lower marginal cost than Enel, thanks to their more efficient gas turbines, says Mr Medda.
应用推荐