Free · Business planning calculators 💼
Price–Cost Lerner Index Calculator
Measure the share of price above marginal cost.
- Formula & worked example
- Private in your browser
- No signup
Calculator inputs
Loading calculator…
How to use this calculator
- Enter the known values in the units shown. Results update as you type.
- Edit a calculated value to solve backwards, or lock a value to hold it fixed.
- Use the worked example to check the method. Reset restores the starting fields.
Use the result with context
Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.
Formula and method
Subtract marginal cost from price and divide by price. A price of 100 with marginal cost of 70 gives a Lerner index of 0.3.
Lerner index = (price − marginal cost) ÷ price
Worked example
Enter these known values and leave the other values blank.
- Price
- 100 USD
- Marginal cost
- 70 USD
- Lerner index
- 0.3
Assumptions and limitations
- Use values from a consistent period, scope and currency. The stated formula defines this simplified model; the explanation describes quantities it leaves out.
Common questions
Does this use average cost?
The formula uses marginal cost. Substituting average cost changes the measure and can make comparisons misleading.
References
The calculation equations, inverse formulas, units, and input rules were imported from this source. Bookify provides the interface and equation solver.
Related calculators
Explore business planning calculators 💼 or browse all finance calculators.