Spatial Margin Of Profitibility ( To find the best industrial location for maximum profit) By D M Smith in his book - Industrial Location (1971) Important points - 1. Spatial Margin 2. Cost curve ( line representing cost) 3. Revenue curve ( line representing revenue) Maximum profit is found at the place having maximum difference between cost and revenue. Condition 1. Revenue cost in constant - cost curve is V shaped. Condition 2. Cost curve is constant - Revenue cost is A shaped. Condition 3. Real World condition - Both cost curve and the Revenue curve vary so the location with minimum cost and maximum revenue should be selected to establish the industry .
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Spatial Margin Of Profitibility
( To find the best industrial location for maximum profit)
By D M Smith in his book - Industrial Location (1971)
Important points - 1. Spatial Margin
2. Cost curve ( line representing cost)
3. Revenue curve ( line representing revenue)
Maximum profit is found at the place having maximum difference between cost and revenue.
Condition 1. Revenue cost in constant - cost curve is V shaped.
Condition 2. Cost curve is constant - Revenue cost is A shaped.
Condition 3. Real World condition - Both cost curve and the Revenue curve vary so the location with minimum cost and maximum revenue should be selected to establish the industry .
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