Revision: Importance of the Margin

The marginal concepts figures prominently within the micro and macro economic syllabus at A2 - in a revision lesson today we flagged up where marginal values enter into decision making by consumers, businesses and policy-makers. And we also discussed the limitations of the marginal concept, particularly as it relates to pricing and in a world where businesses simply do not have sufficient information to make precise decisions ‘at the margin’.

Theory of the firm
Marginal product - diminishing returns
Marginal cost - linked to marginal productivity of variable factors, a variable cost
Marginal revenue - the change in revenue from selling an additional unit
Marginal profit - the profit on the next unit produced and sold
Profit Max - where marginal revenue = marginal cost
Revenue Max - an output where marginal revenue = zero, price elasticity of demand = 1
Perfect price discimination - complete separation of the market, the demand curve becomes the MR curve

Labour market
Marginal revenue product of labour (MPPL x Price of output)
Marginal cost of employing labour
Marginal rate of substitution e.g. of labour for capital (or vice versa)

Externalities, Merit & De-Merit Goods, Public Goods
Marginal cost of supply
Marginal private social
Marginal social cost
Marginal private benefit
Marginal social benefit
Marginal abatement cost i.e. cost of reducing C02 emissions by one tonne.

Macroeconomics
Marginal rate of tax
Marginal propensity to save
Marginal propensity to spend
Marginal propensity to import
Marginal efficiency of capital (Keynesian investment demand curve)
Marginal product applied to the benefits of specialisation and exchange

Have I missed any out? I surely have somewhere!