4.1.4.6 Marginal, average and total revenue
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9 Terms
What is marginal revenue?
The addition to total revenue of an extra unit sold.
What is average revenue?
The average receipts per unit sold.
What is average revenue equal to?
Total revenue divided by quantity sold.
What is total revenue?
The total money received from the sale of any given quantity of output.
Why is the average revenue curve the firm's demand curve?
It shows the average price received at each level of sales.
When demand is perfectly elastic are MR and AR equal?
Yes.
What happens to average and marginal revenue as sales increase?
They fall.
The MR curve is _____ as steep as the average revenue curve.
Twice.
What is marginal revenue calculated as?
The change in total revenue divided by the change in quantity sold.