Finance: What is marginal revenue?

Marginal revenue is the marginal contribution to profits; if costs have already been accounted for, high marginal revenue.

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Transcript

00:28

well because from an accounting perspective it had already been built

00:31

shipped Frette painted with that new flying car smell smell yeah and the [flying with air freshener]

00:36

revenue had generated was likely meaningfully more profitable or at least

00:39

from an accounting perspective then the first car sold why well because so many

00:44

of its costs had already been accounted for or paid for or amortized on the [clip board check list]

00:49

books that factory that stamped out its last product for the year already had a

00:54

year's worth of high use behind it amer tizen the cost of the factory and

00:59

everything that went into winning that last marginal dollar of revenue so that

01:04

from an accounting perspective to make the first sale of that flying tesla for

01:07

a hundred grand well that cost a lawn and company like a billion dollars to

01:11

make the millionth test and sell it for a hundred grand well as it was

01:15

completely made by the robots a you know cost Elon in company only about 20 grand

01:20

like way higher profit margins the key concept to worry about when you think

01:24

about marginal revenues is the marginal contribution to profits which that last

01:30

dollar brings to the bottom line party anyway we hope you got something out of [dollars meeting together]

01:35

this video it's probably one of the last ones not to be made by robots least

01:39

around here