Month: October 2020

    Market Company

    This slowdown comes as long as the gains will not be less than the cost of added resources. This principle is based on theory of marginal revenue and is called the principle of marginal productivity. The company is a system, one of the patterns of development and existence of which is balance, balance its elements. You may want to visit Siemens to increase your knowledge. The maximum efficiency is reached at the company objectively due to the proportionality factor. Various elements of the enterprise should be agreed between themselves on capacity and other characteristics. Add an item into the system, leading to a violation of proportionality, increases the value of the company.

    So, when assessing the value of the enterprise must take into account the principle of balance (proportionality), under which the maximum income from the enterprise can be subject to the optimal values of factors of production. One of the highlights of the this principle is to match the size of the enterprise market needs. For example, if a company is too large to meet the needs of the market, its effectiveness decreases, especially if complicated delivery of goods or resources. The third group of principles is directly caused by the action of the market environment. The leading factor in pricing in the market economy is supply and demand. If demand and supply are in equilibrium, prices will remain stable and may coincide with the cost, especially in a perfect market. If the market offers a limited number of profitable enterprises, ie, demand exceeds offer, their prices may exceed their costs.

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